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Market turmoil affects student job prospects

Jenn Metz | Tuesday, September 16, 2008

The fate of Merrill Lynch and Lehman Brothers, formerly two of the nation’s top investment banks, reflects a “scary time” in the investment community, Lee Svete, Director of the Notre Dame Career Center, said.

“We don’t know yet what the dominant effect will be,” he said.

The once-reliable companies’ failings affect Notre Dame students of all majors, Svete said, in a volatile job market.

“Right now, it’s going to impact our job market for students who want to pursue investment banking but do not have an internship on their résumé,” he said.

Lehman Brothers and Merrill Lynch were not present at last Thursday’s Fall Career Expo, but both firms have been present in the past. Notre Dame students interned at both companies last summer, he said.

The Career Center does not know if any students had accepted job offers at Lehman Brothers before the investment bank collapsed Monday, but Svete said students had accepted offers at Merrill Lynch, which was acquired by Bank of America.

“We still don’t know what’s going to happen yet because Bank of America hasn’t made a decision,” he said.

The two companies’ downfall are not necessarily indicative of the investment banking field as a whole, Svete said, as some middle market banks and other financial services and companies are still hiring.

“It’s important that the middle market is still here in a big way,” he said. “But in this crazy market, with the bigger businesses in trouble, it could change.”

Houlihan Lokey – one of the middle market banks Svete mentioned – is coming Tuesday to recruit on campus. Commercial banks, like PNC Bank and Fifth Third Bank, have also recruited at the University.

“To some extent, we knew it was going to be a volatile job market for investment banking,” he said.

During the Wall Street Forum last week, 178 firms, including Goldman Sachs and J.P. Morgan, said they would hire interns for summer 2009, but analysis on recruiting in the fall is currently on hold, Svete said. Neither Merrill Lynch nor Lehman Brothers were present.

The Career center is advising that students be “flexible” to adapt to the changing job environment.

He said Houlihan Locky was an example of a middle market firm where students can employ the same skills they would use in a position at one of the bigger companies.

Other corporations, like Whirlpool and General Electric, are recruiting students of all majors for a number of leadership opportunities.

Students should realize, Svete said, that they can “work for a company like Whirlpool and utilize their skills – these are still leadership positions”

“It might not be an investment bank, but they’re getting somewhere with a Notre Dame degree,” he said.

In the past few years, Svete said, Notre Dame has had “more and more students land jobs and internships with investment banks.” He said he sees Monday’s collapse as more of a market correction.

“This industry’s going to bounce back,” he said, “and it’s going to look differently.”

This is Svete’s ninth year at the career center and during his tenure he has witnessed the effects of the Enron fraud scandal and 9/11, and has watched students bounce back.

“With Enron, the 40 accounting majors that had jobs going into April, one day they just didn’t have jobs. They all found jobs by the end of May,” he said. “After 9/11, the Career Fair went from 100 companies to 35.”

Svete said that in a tough job market, a Notre Dame diploma becomes even more valuable.

“I think our students are going to be fine,” he said. “I’m not saying it’s not going to be tough out there, that it’s not going to be competitive. Students are going to work a lot harder.”

The reasons for the value of a Notre Dame diploma are two-fold, Svete said. The first reason is the strength of the alumni community.

The second is “how diverse and flexible and well-educated our grads are,” he said. “If I’m a company that was going to hire 10 college grads … and I was going to keep one school on my calendar, we’re going to be one of those schools.”

Svete said that is the reason “why 152 companies and 400-plus recruiters are at our career fairs.” The winter Career Fair is scheduled to take place Jan. 28.

“The companies, organizations and grad schools will realize that our degree, our reputation, our integrity – all the things we bring to the table in a highly competitive market will only make us more valuable in the long run,” Svete said.

Notre Dame’s recent national rankings – 18th overall in the U.S. News and World Report and 3rd best undergraduate business program in BusinessWeek Magazine – indicate that “we’ll be the last school to be cut by recruiting,” Svete said.

“If we get cut, so will Stanford, Duke and Harvard.” The second-tier schools, however, are “going to take a big hit this year,” he said.

Advising numbers at the Career Center are up, and a record number of underclassmen attended last week’s Career Expo, Svete said.