By Andrew Lee

he economic downturn and company layoffs at major financial firms around the country mean added pressure for business students looking for jobs after they graduate. Seven alumni who initially developed an interest in working in finance have adapted to the volatile job market by changing their post-business school trajectory plans.

At least three alumni decided to apply to graduate school until the markets lighten. Others chose to pursue jobs outside of Wall Street, like a study in consulting or engineering.

“These business students are certainly going to have a difficult time in this environment when firms are cutting back and letting go tens of thousands of people,” Senior Vice President of Morgan Stanley Brian Katz (Matthew ’07, Daniel ’09) said.

The national unemployment rate recently hit 6.5 percent in October, an increase of 1.7 percentage points since last year, according to the Bureau of Labor Statistics. The financial services industry has lost 172,000 jobs since its peak in December 2006, according to the report.

A poll by the National Association of Colleges and Employers shows that 52 percent of companies project they will hire fewer graduates in 2009 than in 2008.

“The temporary dislocation of investment banking has forced me to look to careers outside of finance. It’s a blessing in disguise,” a business school student said.

Now that the fall recruiting window for banking jobs is closed shut, he directed his attention to studying law.

“They should look for jobs outside of just corporate finance, investment banking, mergers and acquisitions because it’s going to be very difficult to get a job in those fields for awhile,” Katz said.

He encouraged students to look beyond Wall Street when looking for jobs and to consider a graduate study to gain more skills and to delay entry into the falling job market.

In such an economic downturn, students will increase their job opportunities if they are creative, flexible, open minded and a little more compromising, he said.

“I wouldn’t be surprised to job offers being pulled before they start jobs,” Katz said.

He advised business students differentiate themselves from a pool of application with internships and extra curricular experience. The competition is getting tougher and employers are going to be more selective as they look for the top graduates from the top schools, Katz said.

In this volatile job market, MIT freshman Carter Chang ’08 has now considered working in other fields outside of finance, like engineering and consulting. Chang said he hopes to work abroad in China while going into energy venture capital.

“A lot of my friends who were initially interested in finance are now considering jobs in totally different fields,” Chang said.

Bob Beyer ’77 (Jacqueline ’13, Matthew ’15) CEO of the investment management firm TCW Group, Inc., said there will still be opportunities for graduating students but that they will just be even more competitive than they have been in the past.James Lee ’03, a senior at NYU Stern School of Business, was one applicant who was able to earn a job offer in investment banking at Credit Suisse in Los Angeles after he graduates this June.

“Timing has been a very critical factor in my post-college plans,” Lee said. “As a summer analyst, I was fortunate to have the opportunity to develop and interest in finance and earn a full-time offer.”

Phil Gross ’03 will also be working at Credit Suisse in New York after he graduates from Stanford University. He said he is more eager to work in the industry right now because the massive transformation will be an informative and exciting experience to go through.

“My vision of finance as being a golden ticket to success has certainly changed,” Gross said.

“It is a lot more cost effective to replace more experienced, higher-paid and possibly tired personnel with young, eager and motivated talent,” Beyer said.

Other job options outside of investment banking could include heightened interest in the non-profit or entrepreneurial sectors, where the pay isn’t as good but the work is rewarding and exciting, Beyer said. “It is safe to assume that investment banking opportunities will be far fewer in the next couple of years, and possibly forever,” he said. “Many of the investment banks are being further regulated into more basic services that may provide fewer opportunities for the deal junkies that have populated this area in the past.”

Today’s business students graduate with broad-based knowledge that will serve them well in many pursuits beyond Wall Street jobs, he added.

“Graduating students should feel free to pursue those occupations that truly interest them,” Beyer said. “I have no doubt that their business background will help them to succeed in whatever path they choose if it truly reflects their interests and raises their enthusiasm.”