Update, 5/24/2012: NOTE TO VISITORS from the New York Times and David Brooks’ op-ed: Grateful that David Brooks gave this question a wider platform, and I welcome further comment on the issues he discusses and that are discussed below by my current and former students.
Last week I posted a link on my Facebook page about a short article by Ezra Klein that blames the flow of graduates of selective universities into finance and consulting jobs on the failure of the liberal arts to teach skills. It’s not the massive recruiting efforts finance and consulting companies make, and it’s not the high salaries. In short, Stanford is to blame for offering so many liberal arts classes that are interesting but teach students no, or few, real skills.
There was a quick and impressive response to my post from current and recent Stanford students. Wanting to open the conversation up, I’m re-posting the thread here, stripped of the names of commenters (except for those who agreed to be identified).
My original post:
Question for Stanford students and recent grads: why do so many students enter finance or management consulting? This article gives two explanations: high pay (students simply follow big $$), and organization kid behavior (smart kids like to jump through hoops and be around other smart people). But then it blames this behavior on the failure of the liberal arts and humanities to teach skills. Agree?
1. Stanford Grad
I think it also has a lot to do with how clear the path is….they recruit on campus, the job description is clear, people on campus know the companies etc. If you want a job in say education reform, other than TFA, there is no clear path to get there. I imagine other fields it is even less clear when there isn’t an obvious starting point. Matty’s path to his current artist job was very non-linear even though it is a very appropriate job for someone with the type of degree he has from Stanford. That’s my $.02…based on experience that is pretty out of date so I may be way off.
2. Stanford Grad
I agree that money and status/social influence matter. And his third reason about “gaining real skills” is an insightful one. Wall Street is like the new post-grad training.
Learning how to crunch numbers, give presentations and generally “be a professional” are things that ambitious students desire. It’s not the “fault” of college for not giving them those skills, it’s just a natural extension of how the job market has evolved.
This also explains the increased popularity of rotational programs like at Intuit, GE and other large firms.
3. Stanford Grad
I think there is more risk avoidance in the decision to enter finance or management consulting (and go to law school) than people realize. If you don’t have any idea what you want to do in the working world — and lots of graduating seniors don’t — you haven’t hurt your chances by doing finance or consulting. Future employers who see that on your resume see someone who selected for being smart, hard-working, etc. If you like finance and consulting, great. If you don’t, people who see good experience. The converse is not always true. If you try government or nonprofit work and hate it, you’re fighting more of an uphill battle to get hired at finance and consulting firms. Your experience is not perceived as prestigious or valuable outside that sector.
You and I have talked about this before, obviously… but five quick thoughts.
1. These jobs offer great options on the back end. Some of the reasons for this are good (good experience, training) some less so. While Ezra doesn’t make the connection that clear, this is why the “failure” of universities is relevant. If schools did more project-based education that taught people how to get things done, they would not have the same need/temptation to go get skills from McKinsey, etc. I’ll tell you that having been on the other end for a while now — having to vet candidate for global health NGOs — the consulting experience does signal something of value… much as it pains me. We need to provide training programs at Universities and in the social sector, and we need to help those who want to work in the private sector to do so in a way where they are creating real value and serving the nation/economy, not abusing it. There is nothing wrong with going into business. This needs to be a nuanced argument.
2. Students have little knowledge of the less savory work the consulting firms do (tobacco consulting, supporting corrupt governments, etc), and once they go there they have little incentive to talk about it. The good work gets talked about all over town.
3. Many big players in the social sector did time in the private sector. Studying their resumes could lead one to think that it is a very useful stop. Causation is hard to prove, but there is a hell of a lot of correlation. And what isn’t talked about is how many people went into these fields claiming they were going to leave and do social impact work, and never do.
4. The social sector has done a terrible job of building robust career paths for young professionals. Terrible.
5. The financial services firms that have done so much bad should be a target. I agree. But we need to re-frame this conversation around the positive direction we seek to go — getting the top talent to tackle the biggest problems. Some buddies and I are working on a business plan to address this and to work toward the goal. Let’s talk more soon.
What exactly are the skills you learn in management consulting and finance? Mentioned so far: Professionalism and showing up to work on time. And other folks have told me: Powerpoint and Excel and maybe Stata. What else?
6. Stanford Grad
Jonny Totally agree with 3 and 4. We are pattern matching individuals and young people are stifled by the lack of career progression because executives never move on.
Perhaps others can chime in, but for consulting I’d certainly add the ability to break down a big challenge into workable pieces and the ability to work well in a team. Finance is still a harder sell to me. Certainly the same skills are needed at World Bank, IFC, impact investing, etc. And sales skills are useful for many paths.
8. Stanford Grad
Rob Reich I honestly think it’s less about the skillset than the filter. I think a month long wallstreet bootcamp + some kind of proof that you could last 2 years in a stressful competitive environment would be enough for many firms. Obviously I didn’t take this path so I can’t know what else is gained.
9. Stanford Grad
I think it has less to do with the high salaries and more to do with the general perceived value of these positions among students. When recruiting season hit my senior year, I remember everyone prepping for consulting/finance interviews. Because it seemed as though everyone was interested in these positions, it created a fervor of competition that reminded me of the days I was applying to get into college. We’re a pretty competitive bunch at Stanford, so I think plenty of qualified students apply purely because of this group-think approach. If I compare the reactions my friends received from a) landing a non-profit job and b) landing a job at Goldman Sachs, reactions to the latter were certainly more impressive.
I think finance/consulting seems like a great option when you have absolutely no idea what you want to do in life. Students are told that bankers/consultants get to work with high-ranking executives at Fortune 500 companies, so they think they a) can learn a lot from working on these “high-profile” projects (excel, modeling, project management, statistical analysis, powerpoint, public speaking) and b) are that much closer to getting on the path of being an important exec. Students are told that “no day is the same, your projects and clients change, giving you the ability to switch things up and learn more” – for someone who doesn’t know what they want, this sounds like they can sample a bunch of different industries and possible jobs.
Unfortunately, I feel like I got a better idea of learning what I wanted to do in life from internships, rather than inside the classroom. Is this something that Stanford could have helped with? Maybe – some days I wish I was forced to take a computer science class my freshman year or something more “practical”, but I don’t think I would be where I am now without prioritizing theory over application.
10. Stanford PhD Student
Data question: how bimodal is the income distro for humanities/social sciences types? My hunch is very, i.e., v. high consulting-type things and v. low nonprofit type things. This might add another dimension to the greed question: how many Stanford kids who go into finance would be happy with something less evil/high-pressure but moderately paying, but don’t know where to get it?
One quote from this article that resonated with me was: “For many kids, college represents an end goal. Once you get into a good college, you’ve made it, and everyone stops worrying about you.” I think this speaks not only to the dilemma that college students subsequently face when they realize that college is only the beginning, but also to the qualities that elite colleges select for: the ability to “check the boxes”, an obsession with markers and symbols of success, the need to take a well-defined and well-trodden path, etc. Let’s say these types of students represent half of the student body at schools like Harvard and Stanford. Is it really surprising that they then go on to consulting and finance?
Oops – didn’t realize pressing “Enter” would end my post. Then, I would imagine, the other half is the inspired thoughtful do-gooder type that professors like Rob teach. The question is, why are some of these students (probably a smaller but still significant proportion) drawn into consulting/finance? I won’t rehash all of the above comments, since I think they do a good job of summarizing it. But I guess the question I find more interesting than “why do students take lucrative, ‘safer’, and more conventional career paths?” is “what can the social sector do to appeal to the ‘other half’ of elite college graduates who might be inclined to go try and save the world?”
13. Stanford Grad
@catherine: This resonated with me as well. When I got into Stanford, I remember my mom saying “Alright, you’re set! Companies will be banging down your door to hire you” – that didn’t quite happen, especially for my peers in the class of 2009.
Agree with most of the above, based on conversations with/observations of friends who took that path. I think the financial rewards become more important as you go along and get used to a certain post-collegiate lifestyle (or those of your peers), but they aren’t necessarily what drives people to those careers at the outset. (That said, needing to have health insurance and pay student loans won’t necessarily drive you to finance/consulting, but it certainly can limit your options.) I’d also emphasize Jonny’s #1-3 and commenter #3’s point about risk-avoidance—the public/social sector loves to hire people with consultant/private sector backgrounds but not so much the other way around, not necessarily because they have better skills (though that’s how it’s sold) but because of the resume/prestige factor. Basically, there are a lot of paths that sort of lead towards consulting/finance by default, whereas you have to be kind of set on doing something else, or on *not* going into those fields to push back against the various things that nudge you in that direction—and a lot of college seniors just have no idea how many kinds of jobs/ways to live are out there.
For what it’s worth, not many of the people I know who went into consulting and finance right after graduation are still there—most ended up moving to tech/startups, even though few of them have technical/programming backgrounds. I think that’s both because people got sick of being Excel-monkeys (another thing consulting firms don’t tell you going in) and bc the tech world is perceived as cooler/funner/friendlier. That doesn’t necessarily mean those companies are doing anything better for the world, though.
As for whether universities are failing students who don’t feel they have the skills to succeed in the “real world” right out of college—meh, I really don’t think that’s the main issue, and I really don’t think we need to be turning colleges into pre-professional schools/training institutes any more than we already are. I think a more serious failure is in cultivating students’ image of themselves as the “best and the brightest” (always funny when people use this term in earnest considering Halberstam originally meant it ironically), “cream of the crop” etc. e.g., as people who always need/deserve to be at the most elite institutions/doing the most prestigious thing. That is emphatically NOT confined to the folks who end up in finance/consulting, it’s just one way it manifests itself. But I also know plenty of people who took public service-y paths, myself included, who struggle to reconcile the particular type of personal ambition that is very strongly encouraged at places like Stanford with the broader goals of their work. For all that it often drives people, I actually think it’s a really debilitating attitude to have, and I wish Stanford (/society) would put some real effort into supporting students who actually want to follow Steve Jobs’s much-vaunted advice and “find what they love” even if they take a weird path to get there or love something that doesn’t fit into a certain narrative. I hear lots of talk about this and see very little walk.
15. Stanford post-doctoral fellow
until I found out I could do postgrad without going into debt (by emigrating to the u.s.), I was thinking about management consultancy for the “work is varied and interesting” and “opens up options later” reasons. This was after I’d been to the Oxford careers office, and looked through their non-profit section, and found absolutely nothing that looked interesting. unless other career paths are made salient, then i suspect consultancy and finance will often win by default
16. Stanford professor
in X’s case it was less a desire for high pay than a desire for pay, period. the Big 4 consulting firms actively recruit philosophers, and who else (including most philosophy departments, in the current market) is doing that? as for “Wall St giv[ing] university graduates the skills their university education didn’t”, that’s not quite how they put it to X. It was more about liberal arts PhDs giving consulting firms the skills that an MBA didn’t give the other people they have traditionally focused on hiring.
17. Stanford student (former summer intern at Goldman Sachs)
Jonny, I wish that I could help you more with exploring the finance track, but it’s not my path. I thought that my internship at GS would provide me a good look and better understanding of the financial markets and how I could use them to teach myself and others about wealth creation–something that I had little exposure to growing up. Seen way too many people work too hard for too little.
As for the points that you bring up, I totally agree with transforming private sector opportunities into jobs that provide true service to your given community/nation/economy. One thing that I’ve noticed is that the type of impact that you make in the private sector tends to be concrete (bottom line, revenue, percentage gain, uplift, etc) which does wonders for young people looking to show off all that they’ve “accomplished” with the time that they devoted to a job. In my opinion, since so many people are looking for meaning in what they do in their careers, these numbers can provide value from job to job until they are replaced with true focus and direction.
“Once you get into a good college, you’ve made it, and everyone stops worrying about you.”
“Colleges are producing a large number of very smart, completely confused graduates.”
These two quotes really make me think that so much of college just ends up being an exercise of “the blind leading the blind” into the next phase of life. Some people truly know what they want and others need time to place the pieces into what seems like the right order. For those looking to their peers and learning from their environment as comment@9 pointed to with the “group think” comment, there will continue to be certain uncertainty (the state of knowing that you need to figure it out but can’t slow down to ask yourself what you actually want and are capable of). At Stanford for sure, no one wants to be perceived as the duckling that fell behind because they couldn’t paddle hard enough.
My issue with the colleges is the fact that until the recent past, they have gone unquestioned in all of this. As professors, admins, and everyone else involved, could you not have seen the shift in students’ responses to the economy, their peers, their future aspirations, etc.? I can’t imagine that things were always like this, so what is it that changed under the noses of the people that can play a huge role in shaping what the education looks like?
Rob, I don’t think that is it. What someone majored in isn’t that relevant.
@17 I didn’t realize you hadn’t stayed on. What are you up to? I love your last sentence. This is particularly relevant at a school like Stanford which has an explicit message to form leaders dedicated to the public good
19. Stanford Grad
This conversation assumes that everyone is temperamentally suited to non-profit work, but that’s not the case. Devoting one’s professional life to thinking about how messed up the world is requires substantial emotional resources, and not everyone can psychologically withstand that. Especially for students who care so much about an issue that it keeps them awake at night, a 2 year analyst program in a less emotionally charged industry may have tremendous appeal. Perhaps the challenge is helping students reconcile their social contributions with their own personal limitations, instead of assuming that everyone has the capacity for raw unbridled commitment to a cause.
20. Stanford Grad, current director of nonprofit organization
Great discussion – I think so much has to do with how clear cut the path is, the guidance and familiarity, creation of jobs specifically for entry-level college students. Going into family support/child advocacy I couldn’t find a job until a month out of college – a risk I could take because my parents supported me for that uncertain month. But I am quite sure I got the same key work experience and skills from my first years in the non-profit world as I would have in consulting. Just a different leap?
21. Stanford Grad, current staffer at DC think tank
Alright, I’m going to chime in here. Going back to Rob’s original question–”But then it blames this behavior on the failure of the liberal arts and humanities to teach skills. Agree?”–I can’t help but think: College isn’t supposed to teach you those types of skills.
I learned Stata, then promptly forgot it. I use Excel efficiently because I can Google the answer when I find a problem. And I certainly did not learn how to show up for things on time because I still don’t show up for things on time. I am very wary of the idea that college should have taught me more of these things unless they were somehow paired with intellectual value.
What college should teach you is how to think, I think, not how to collate or play with excel. People leave college without any workplace skills because they don’t have any workplace skills, but that’s because they were in college, and not the workplace, for the past four years. I don’t think this is a problem, but it certainly can seem like a problem to someone who is trying to get hired to work in a workplace. In other words, back to the anxiety argument again. Whether that anxiety is misplaced is a good question, but when you’re faced with impending unemployment it probably seems like the right type of anxiety to be experiencing.
Second, I’ve heard the idea from multiple people that they want to take a high-paying job right off the bat so they will have some savings (or pay back loans to then have savings) so that then they can use that money to do something they’re really passionate about but wouldn’t be able to do and remain simultaneously financially solvent otherwise. I’m curious what other people think of this, or whether they know people who’ve pursued this path.
Those are my €.015, thanks for all the interesting ideas.
22. Stanford Grad, currently working in finance
Jonny, as you mentioned, I am going into finance, and specifically, a trading seat. What that means is I will be buying and selling commodities to help different producers and consumers of raw materials, for example farmers and airline companies, hedge their costs production and usage.
There is nothing I would rather do upon leaving college. I agree generally with some of the comments that have been made here, that people go into finance for money, prestige, etc. For me personally, I see my job as one of the best ways to learn about the world, and really gain a solid grasp of it. To do my job well, I have to understand how the crude oil market works, meaning I have to know the ins and outs of Iran’s relationship with Syria, how Syria relates to Russia, how the three relate to Saudi Arabia and the Arab League, and how all those I just mentioned relate to the Western world. Similarly, to understand the cocoa market, I have to know the cultural and religious dynamics across regions in Nigeria, how that relates to the Ivory Coast and Ghana, and whether production in West Africa will be enough to meet demand from European confectioners.
To cut to the chase, in the long run, I want to devote most of my life to philanthropy. For me, finance is the best way to learn about different parts of the world and to better understand people, which should make me a better philanthropist one day. The money, connections, and prestige may help my cause too, but lots of people going into finance have those. For me, it’s about the learning experience.
23. Stanford Grad, current PhD student
Really interesting discussion. Thanks in particular to @22 for your thoughts. I’d like to make two points.
The first riffs off of @19 above. Namely, the premise of Klein’s piece seems worth questioning. Why assume that the outcomes we observe aren’t optimal both for individual students and for society? Why are we so confident that such large proportions of the elite student mass going into finance and consulting shouldn’t normatively be doing precisely that? Even if we take as given that more than 65% of the graduating class of an elite university is interested in promoting social good (another questionable premise), why are we so sure that another route besides finance/consulting will be more likely to do so?
We don’t know much about how to actually make social good happen. One of the few things we do know is that economic growth is paramount. No NGO will come close to matching China’s poverty relief program (by which China has sustained 9-12% growth for decades with an iron fist and has pulled ~600 million people out of extreme poverty). Of course, we also know very little about how to make economic growth happen (China has, itself, undermined many theories). But we do know that having functioning credit and insurance markets is essential. I recognize that the prevailing wisdom these days is that Wall Street is evil. But, at the end of the day, if we pit Wall Street against NGOs, smart people can easily disagree as to which sector did more for the poor and the downtrodden and the environment than the other over the past couple of decades.
My second observation is that these types of discussions often presume that students coming out of schools like Harvard and Stanford are far superior to their peers coming out of great but second-tier schools that send fewer people to finance like, say, Tufts. That is hard to defend. If the entirety of the Stanford graduating class were to go into finance and all of the NGOs had to pick folks to fill entry level positions from Tufts, would those NGOs really be worse off? Many of my most successful and innovative colleagues in the nonprofit sector had less elite educational backgrounds. In some areas, they had skills I didn’t because of it. They often knew just a bit more about how the “real world” worked. At the end of the day, elite universities train students in elite skill sets that are very useful in certain career paths and less useful in others. Finance and consulting really value people who are widely read and thoughtful. Though certainly not always the case, sometimes those types of people are poor fits for public sector work. On the day-to-day level, advocacy can be as intellectually dull as trading and government bureaucracy as soul-crushing as Excel. I think it’s worth asking whether, rather than observing elite schools failing, we’re simply observing them successfully filling a market niche that society values.
24. Stanford PhD student
@19 makes a very good point — when I was doing the legal aid thing, I burned out almost immediately just from the overwhelming need out there & its interactive consequences (e.g. hostility toward me from the people whom I was trying to help, because I represented, to them, just another bureaucracy) — it takes psychological resources many don’t have to do a lot of do-gooder jobs.
I’m always cautious about embracing the nostalgia of older folks to return to “the good ol’ days” of yesteryear. But I do think we’ve lost a certain civic ethic in this country over the past few decades – a “public philosophy,” as the late sociologist Daniel Bell put it in “The Cultural Contradictions of Capitalism” – especially compared to our grandparents in the Greatest Generation, which was called upon to overcome depression and fascism itself and literally rebuild the world order.
This civic ethic was an integral part of the social fabric that held the elite to higher standards of order and social responsibility – the kind of ethic that would lead a young President Kennedy to call upon Americans to “Ask not what your country can do for you – ask what you can do for your country.” It’s frankly hard to imagine a president saying this today while keeping a straight face.
In his Foreign Affairs cover story from the fall, “The Broken Contract,” George Packer argues that social responsibility among the American elite has fallen dramatically since even the 1970s. “But even more fundamental than public policy is the long-term transformation of the manners and morals of American elites — what they became willing to do that they would not have done, or even thought about doing, before,” he writes. “Political changes precipitated, and in turn were aided by, deeper changes in norms of responsibility and self-restraint. In 1978, it might have been economically feasible and perfectly legal for an executive to award himself a multimillion-dollar bonus while shedding 40 percent of his work force and requiring the survivors to take annual furloughs without pay. But no executive would have wanted the shame and outrage that would have followed-any more than an executive today would want to be quoted using a racial slur or photographed with a paid escort. These days, it is hard to open a newspaper without reading stories about grotesque overcompensation at the top and widespread hardship below.”
I can’t help but see the “brain drain” of elite graduates to Wall Street, the financial bubble and collapse, and skyrocketing inequality as partly emblematic of the degrading standards of social responsibility among the elite. I understand and appreciate many of the incentives that lead bright young people to work on Wall Street and seek various get-rich-quick schemes, and some of this is productive and important. But I think we’ve lost a basic sense of civic ethic – even a degree of moral compass – when we can’t step back and say, you know what, maybe that’s just not the right thing to do, particularly when you’re someone already from a privileged 1% background.
Part of this problem relates to a broader cultural trend toward hyper-individualism and the “virtue of selfishness” promoted by Ayn Rand. It’s an ethic that allows people to justify a pure pursuit of self-interest with little regard for the larger public good. It’s the same ethic that Elizabeth Warren has become popular for finally putting a foot down and speaking up against and declaring that “No! There is nobody in this country who got rich on his own — nobody… part of the underlying social contract is, you take a hunk of that and pay forward for the next kid who comes along.” It’s unfortunate that our university campuses don’t try to embody and foster more of that kind of spirit.
In the 1970s, Daniel Bell was somewhat prescient in predicting these underlying cultural trends, and went as far as to say that “A new public philosophy will have to be created in order that something we recognize as a liberal society may survive.” Personally, I think this task is one of the most important our generation faces, especially given the scale of the challenges we face. We simply cannot afford to keep sending so many of our most bright and hard-working young people to Wall Street and management consulting firms, and our society has already paid dearly for it. It has been hopeful to see more and more young people challenging this status quo over the past year (e.g. through campaigns like “Stop the Brain Drain”), but we really need more of it, and as Jonny keeps saying, we need to figure our more proactive, constructive ways to institutionalize alternative pipelines.
p.s. If you’re interested, the sociologist Fred Block recently wrote a reinterpretation of Bell’s predictions and how this relates to the rise of the Tea Party and the ongoing backlash against the role of government, very much worth reading here.
26. Stanford student
I especially liked the comment about not everyone being temperamentally suited to non-profit work is pertinent. To bring a different perspective, the intense pace (and therefore implicit promise of a jump-start to your career) promised by finance/consulting jobs really resonates with Stanford students who thrive under high-pressure atmospheres. If non-profits and other non-traditional pathways for high achieving college students want to compete head to head with banks and consultancies, I think they’ll have to match these jobs’ resonance with our desire for a job where we can live up to our (self-perceived) potential.
Perhaps more importantly, this conversation also reminded me of a quote from the President of Chile a few years ago-something along the lines of “we have to stop thinking about the private and public sectors as fundamentally at odds.” I think as my generation sees the massive gridlock in Washington, many are skeptical of the role public or quasi-public institutions can play in effecting public improvements. My (optimistic) take is that by consequence, college students increasingly see private sector careers as a legitimate way to enact meaningful social difference. Plus, it may sound crass, but having a financial “bottom line” to which you are held accountable can seem a lot more appealing (at least early in your career) than seeing your efforts constantly stalled by a flavor-of-the-week, vitriolic political “controversy” (as is often the case in the world of environmental NGOs).
27. Stanford Grad
Such great discussion. A lot of the article’s points and comments above really resonate with my experience, especially those around the app process and skill dev. I think the TFA example is an extremely relevant indication of the effectiveness of a structured entry process that is familiar, and satisfies a drive toward systems that convey selectivity (prestige indicators seen as markers for success / ambition in the fuzzier world of employment that follows an entire life of clear hoops and marks of achievement in the education system). Importantly, the app process with these paths allows for the security of having a position months before graduation… The nonprofit sector, at least, by nature hires in a relatively short time frame out of budgeting and operational necessity. It is extremely difficult to find an entry level NGO position more than a couple months before the start date. This is scary, and anecdotally I think TFA has taken on the role of go-to “do good” option for students thinking through post-grad plans, in large part because of its effectively structured and early recruitment process. Other options simply aren’t as visible or stable.
On the skill and education side, which I think may be more at the heart of Rob’s prompt here, I absolutely agree with the multiple suggestions that folks turn to consulting, finance, etc as good skill building paths for future, perhaps undetermined long-term careers. Whether or not these jobs ACTUALLY develop skills more than other jobs I can’t say; regardless, the important issue is that they are PERCEIVED that way. I, like Jonny, completely admit to being pulled by the appeal of an applicant to a nonprofit position I’m hiring for who has private sector / consulting experience. And I also have been fascinated by what seems to be a trend among the young professionals I work with in the NGO space to seek out opportunities in consulting even after starting a career in nonprofits, in order to “develop skills they wish they had to bring to their public service work.” Clearly there’s a perception of value of skills going on here.
When it came to my own post-grad job search, it is 100% true that I relied on “work” experience from summer and school-year experiences and internships completely outside of the classroom. I was committed to finding work with an org doing social justice work I believed in, but found that job postings for regular staff positions consistently required more experience than I possessed, or were so entry-level to appear boring and completely unchallenging. I was incredibly lucky to find a role that I found very personally challenging and interesting, and for which I was qualified based pretty exclusively on my work outside the classroom. If I hadn’t been fortunate enough to have parent support allow me to only need PART-time summer waitressing / student office work to support myself through unpaid internships and volunteer positions, I would have found myself completely unqualified for any position that I found remotely challenging or interesting in my sector of choice. To me, this doesn’t undermine the value of protecting a liberal arts education’s focus on learning vs. vocational training. My fairly hard-skills-free social sciences education was instrumental in shaping who I am as a human, and the way I will think through the ethics and broader social meaning of my work quite likely for the rest of my life. However, I think this means that if institutions like Stanford want to take seriously their call to develop students who are “of greater service to the public” (to call upon a little Jane Stanford), they need to get serious about the fellowship, internship, project-based courses, and work-service opportunities they are making possible for students from all backgrounds. Universities can help make sure students are addressing society’s greatest challenges by making visible a wider variety of paths (positive impact can come from all sectors, to Jonny’s and @23’s points), demonstrating through departments and alumni modeling what it looks like to use your education in a variety of service-oriented ways, and being realistic and scale-serious about the importance of practical workplace experience as a complement to classroom learning. Public impact organizations need to respond in kind by stepping up their own seriousness around creating practical career paths for driven, smart young professionals eager to be challenged, have impact, and -hey, this is understandable- know they’re headed in a stable direction.
28. Stanford Grad
To chime in on this (a little late, as usual), I don’t buy Klein’s argument that skills are the key explanation because I think it’s pretty hard to spin a story where TFA is winning the recruiting game because of “skill development.” Rob’s point about the vapidity of skill development in consulting or finance is well taken, but as @27 said, at least recruits in those fields often cite “skills” as an attraction; I don’t see new TFAers bragging about all the classroom management skills they’ll learn (even though they may learn plenty). (But correct me if I’m wrong, Catherine or Rob.) Given TFA’s obvious recruiting success in spite of the lack of “skill” justification, I find Klein’s skill-based account implausible. Instead, TFA’s success seems to me to fit exactly the socialization narrative he dispatches.
In other words, “skills” are just the first person version of “good options on the back end,” to use Jonny’s phrase. I think this is clear from how Klein phrases the main transition in the article: “A bigger draw, explained a recent Harvard graduate who majored in social science and worked at Goldman Sachs for two years, is how Wall Street sells itself to potential applicants: As a low-risk, high-return opportunity that they can try for a few years and, whether they like it or hate it, use to acquire real skills to build careers.” Skills don’t need to be part of this story for it to make sense; careers could be built on signaling just as much as skills.
The obvious questions remaining from my perspective seem to be:
1. What portion of the future success of those who starts out in consulting and finance is a result of signaling and what portion is a result of human capital development? (This assumes, for reasons related to @28’s points and @27’s & Jonny’s endorsements, that these fields do produce disproportionate future success, on whatever metric.) I take this question to be an empirical one, which isn’t to dismiss it but just to express my ignorance about the answer. For TFA, as I argued above, I find signaling the more compelling hypothesis, but I could easily be wrong.
2. It seems to me to be the case that there will be some people who achieve the most positive social impact by working in finance or consulting, and others who achieve it by working in NGOs (and that these groups might overlap over the course of their careers and in light of different particular job prospects). The relevant question for me is less “how to stem the tide of ‘elite’ students into finance and consulting” and more “how to help individuals weigh the social impact of the various opportunities they face (including profitable ones), in light of their particular talents and interests, and then decide how to act in light of that.”
I doubt that there is a one-size-fits-all answer to the second question, and have recently come to suspect that the right answer might be surprisingly folksy. In terms of parameters for an answer, it seems that we should acknowledge both that working in finance is the socially optimal career path for some people, and that, as Alyssa points out, people can and often do pursue careers that are not socially optimal. This latter condition seems to be more common than @23’s account would easily explain.
Rob, you don’t happen to be Facebook friends with Bill Deresiewicz, do you? It would be great to get his take on this.
William Deresiewicz: the excellent sheep and black sheep of Stanford are in hot debate about why so many Stanford, Yale, Princeton, & Harvard grads go into finance and consulting. Any chance you’d weigh in here or elsewhere?
30. Stanford student
Would you say community service is more a part of self-actualization, something many people do after making it big / fulfilling lower level needs? (Maslow’s Hierarchy of Needs)
31. Stanford PhD student
Hmm… if signaling, what’s the marginal benefit of Goldman + Stanford over Stanford alone, signaling-wise? Does the actual signaling benefit match the perceived benefit?
32. Stanford Grad
@31: Seems pretty high. The consultants @27 and Jonny hire are apparently better than other people with similar resumes who haven’t done consulting. And consulting jobs, in at least a few companies, are quite hard to get.
33. William Deresiewicz
Terrific conversation. I’m learning a great deal. My feeling (perhaps only an assumption) has always been that the crucial factors here are psychological: not so much greed as fear; not so much careerism as credentialism; the fact, as @23 began the discussion by mentioning, that finance-consulting-law-TFA replicate the process students are already familiar with, laying out a clear path that involves specific requirements, rewards, and modes of competition. (We’ve forgotten medicine here, the other big one, perhaps under the mistaken assumption that people necessarily go into it for altruistic reasons.) I’ve also heard people say that in default of any specific passion or purpose, students figure, why not go into something lucrative? (Not sure the issue of skill-building is something most people are really thinking about in college.) And then, once you get into a lucrative profession, the money becomes addictive. One young person (ex-Citicorp) said to me, “I was afraid if I stayed in and I was happy with the money I would never leave.” Another said, “It’s easy to get stuck with a great salary.”
And of course I agree that college needs to be about learning to think (and above all, to think about yourself) rather than vocational preparation conceived in narrow terms. But I’m also persuaded by what others are saying about the need for colleges to create structures that will help students move into the workplace more effectively. It doesn’t need to be zero-sum game, thinking vs. vocational preparation.
I’m also struck, no doubt as someone who comes from the humanities, that the horizon of the discussion seems to be the desire to figure out how to get more graduates to go into the social sector or even social-change work more broadly. No one has talked about the arts, the intellectual world, even academia. The ministry, the military, government itself, for the most part: whole sectors are slipping from visibility. Add to that the fact that what a lot of young people really seem to want to do these days is start their own business, whether for social-change reasons or just for the autonomy. While I agree that we need to find ways to show students that there are alternatives to the big four, the more essential problem is to help them discover their own passions and purposes, wherever they may lead.
In case anyone joining the conversation here hasn’t read or doesn’t know about Bill’s relevant articles, read “The Disadvantages of an Elite Education” and “Generation Sell”, among others.
This is the biggest and best conversation I’ve been a part of on facebook. Thanks, Rob, and everyone who commented.
I’ll add a few more thoughts later, but more want to add a few more minds with different perspectives.
A successfully made the finance to social impact. A – why don’t more do this? Was it the right path for you?
B, C, and D are partners in crime thinking about a new venture to address this. They all have great thoughts.
E has bounced between McKinsey and various impressive public impact jobs.
F is doing some incredible work in impact investing / for-profit social e, and earned her stripes in banking first.
G is a social/political entrepreneur, and bemoans the fact that many of those in our generation who are tackling the biggest problems avoid the most powerful path — politics and advocacy.
Also, I’d want to separate out two issues here:
1. Is the (disproportionate?) flow of human capital into finance and consulting socially optimal or even beneficial? I’m reminded of the Stanford Business School dean who said, in the wake of the 2008 financial crisis, that one good outcome would be *fewer* students applying to business schools. Leave aside questions about the social utility or goodness/badness of finance and consulting, and ask simply whether seeing 30% or 50% of the graduating class at Stanford/Princeton/Harvard/Yale go into finance and consulting is a good allocation of human capital.
2. We ought not pit finance/consulting against nonprofits or social sector work. Agreeing with Bill @33, I think a better question is to ask why so few students graduate from college and join the military or the CIA or the ministry or any of a number of other occupational tracks that seem to have little or no traction at Stanford.
Rob, if you’re leaving out the goodness/badness of finance and consulting, how are you measuring the (quality of the) allocation of human capital? (probably not by the utility of these jobs to graduates themselves, as revealed preferences are pretty telling here) As you and Bill Deresiewicz suggest, there is some inherent value in bright, motivated graduates working in a variety of fields and developing different perspectives/skills. If the labor market doesn’t incent this sort of human capital allocation, what will? Programs like TFA that make “alternative” career paths more viable and attractive? Inspiring professors who dare their students to take the road less traveled? I’m interested in hearing what people think is the best mechanism to achieve a better/more varied allocation of talent (and/or one that is truer to graduates’ “passions and purposes”).
Re: passions and purposes, I guess I have a hard time dissociating the moral (self-righteous? :)) element from the job decision. This isn’t to say that consulting and finance are bad and social sector jobs are good – in many cases, conscientious, thoughtful grads are right to invest in the skills and signaling that come from those jobs (so long as they follow through on using them for “good”). But I don’t find all career choices morally equivalent so long as they represent the choosers’ passions and purposes. I thought about going into opera for years before having some formative experiences in the social sector and deciding that it was simply “more important” to spend my work hours thinking about expanding opportunities for the most vulnerable. Is this judgment misguided and somewhat hypocritical? Perhaps (after all, I’d like nothing more than for some of the students I’ve worked with, for example, to pursue their own passions outside of the social sector). Was my moral decision just an illustration of my own true passions? Probably. But I think that a “better” allocation of human capital will result from individuals thinking hard about, and optimizing on, what they love, what they’re good at, and what is important.
38. Stanford Grad, current Stanford PhD student
Fantastic discussion all. I agree heartily with Jonny that this is the most intriguing facebook discussion in which I’ve been involved.
I think Rob’s brought us back to the most interesting questions here: (1) what is the socially optimal allocation of talent from Harvard, Stanford, Yale, Princeton and (2) why not other professions (engineering seems to be a key one)?
On the first, I mentioned Tufts earlier because I still think it’s important to view these schools’ graduates as a small subset of a much larger pool of smart young people in America. I don’t know the numbers, but I don’t think we see the same proportions going into finance at other schools, such as the best state schools. So what we’re observing isn’t necessarily a disporportionate number of talented Americans entering finance, but rather a much more narrow phenomenon.
In light of that, I wonder if one of the most serious concerns we should have about this observation is related to the impacts of social networks on society. There are many reasons to suspect that having a dense concentration of graduates from a few schools in any one particular industry is not socially optimal, simply because it makes it much more difficult for that sector to be responsive to both its clients and the social good at large. Do others have thoughts on this?
39. Stanford Grad, currently working in renewable energy engineering
Coming to this conversation late as well, but I thought I would try to pick out some of the more salient points coming from the perspective of someone who has altruistic aims but no real desire to pursue them through NGOs or Wall Street (I work in renewable energy engineering) for now.
First, though, I think it’s important to realize that the potential pool of elite students that we’re talking about (ones that want to do lots of social good and begin at Wall Street) is perhaps not as big as much of this conversation suggests. There are basically three types of people that are attracted to these high-stress Wall Street jobs right out of college: people who are primarily motivated by money and the challenge/prestige associated with that sector, people who need some job security out of college but aren’t sure what their long term goals are (they might be altruistic or not), and people who definitely want to do something else but think the best path to that is through “doing their 2 years” in consulting or finance. For NGOs and social ventures, the people you want fall into those last two groups, but are not, by any stretch, the majority of people that go into these jobs. I know lots and lots of Stanford students that went straight into consulting or VC work or finance because they like the money. These aren’t the people you want in a social venture because, even though they might work hard, they aren’t intrinsically motivated.
@27 was right on with her TFA analysis. TFA gets people in those last two groups because they offer the security of a job in advance, and because (and this is a MAJOR criticism of TFA) they say they prepare people to “do whatever you want” after TFA, armed with new, valuable skills (like how to work your ass off with a smile on your face). It’s a great alternative to Wall Street for people that aren’t extrinsically motivated like the first group. Jonny’s venture with GHC did the same thing, in a way, and now we’re seeing groups popping up (like ReWork) whose only mission is to pair people with NGOs way in advance – they will attract people in those last two groups as well. I think creating a stable, popular platform for getting people secure positions in NGOs will shift the game a bit. As Karen mentioned, though, it will require NGOs to be more forward looking with positions (much easier said than done).
Coming back to Rob’s original question, I don’t believe this is a failing of the liberal-arts. TFA proved that you can attract hard-working elite students who will work really hard for very little money if you build the right platform. Over the past couple decades, Wall Street has built a very very good platform, and is attracting lots of talent because of it. The non-profit sector got left behind (probably because they were too busy trying to balance saving the world with not having enough money to save the world), but it doesn’t mean it’s hopeless. I don’t think students are any less altruistic now, or that Stanford is letting their students down with their educations, but until the social venture space can develop a recruiting methodology that presents the same opportunity (a bit of security *before* graduation), the same reward (challenging work environment [Stanford students LOVE to say they are overworked, it's like a badge of success]), the same visibility, and the same familiarity (obvious application channels, structured interviews etc), they will continue to lose people to Wall Street.
40. Stanford Grad, currently working in management consulting
Hey guys, saw some great points above and wanted to offer my own thoughts as someone who has spent time in consulting. 1) I’m not sure why people see consulting as a poor use of human capital (here I would differentiate consulting from finance, which I feel often ends up as a zero sum game – if GS makes $1 on its own proprietary trading, eg not hedging, someone else almost invariably loses that same dollar). On one project in consulting, I worked on a 5 person team that designed and implemented a program to dramatically improve patient adherence for a pharmacy, saving tens of thousands of patient lives. Where else could I have had that social impact at 22? Companies hire consultants because in general they earn their keep by making stuff work better–increasing the pie instead of just stealing a bigger piece. 2) I worked in consulting because I believed it would be intellectually challenging (which was absolutely true, though I agree all projects are not created equal) and because I thought I would learn more than any other option I had. The second part was the key, and that has also worked out great–when I worked for a nonprofit in East Africa after my time in consulting, I couldn’t help but think how I would have been 1% as effective without my prior experience. I’ve spent time in government, nonprofits, and consulting, and only in consulting did I receive meaningful, actionable feedback on my analytical thinking and communication on a daily basis. Moreover, because firms want to get as much value as possible out of you, in consulting you are constantly being thrown into roles that are increasingly difficult, forcing you to step up whether you like it or not. I have not felt as challenged as I felt in consulting anywhere else, including at nonprofits, government, an undergrad, and in graduate school. Does consulting have flaws? Absolutely – the hours can be brutal, travel is tough, and it can be hard to really care about the problems of a fortune 500 company when you’re really excited about other issues (be they tech, politics, development, or other). That said, if you really want to learn how to think analytically about really complicated, intricate issues and contribute quickly, I’d love to hear about a better option.
41. Stanford Grad
Thanks @Teryn, I’ll toss a comment into the mix. I find it frustrating that finance and management consulting are always lumped into the same pile in these discussions. A clear distinction needs to be made between the two. Management consulting takes smart people, and applies their skills towards helping companies run better. In the most basic sense, That Is a Good Thing.
Finance, on the other hand, includes large numbers of people who are actively harming society. Traders, hedge funds algorithm designers, and the “financial engineers” who invent new financial instruments are basically armies of very smart people engaged in an epic, zero-sum parlor game against one another, played with other people’s money. Efficient markets are good, but there obviously comes a point where markets are “efficient enough”. Remember, farmers did just fine hedging against changes to fuel costs 100 years ago. You don’t need top Harvard grads sitting in front of a Bloomberg terminal to help a farmer hedge against fuel increases, unless the markets for oil futures are largely controlled by other top Harvard grads also sitting in front Bloomberg terminals. The games are zero sum, but that’s not the worst of it. The games they play don’t just take smart people away from other places in the economy where they could be doing good. They put the entire world economy at risk by often trading trillions of dollars in long term losses for billions in short term gains. When all those losses show up at once (usually long after the traders have gotten their bonuses and left), we risk sending the world economy into the depths of a depression. How many times does it have to happen before we put a stop to it?
I’ll leave the legal profession aside for now. They have their fair share of pitting our best and brightest in arms races that have zero net economic benefit (say, the lawyers who write the tax code vs. the lawyers who find tax loopholes), but the legal profession never put the entire world economy at risk.
Thanks, Bill, for pointing out that the Wall Street-NGO dichotomy is a false one. And thanks again to everyone here; agree with @38 and Jonny that this is the best and most substantive FB interaction I’ve had. (Too bad these comment boxes are so ill-suited for this kind of discussion.)
In response to #1, Rob, I don’t think we can really ask that question without asking whether the broader financialization of the economy is also optimal. And when you ask that question, you have to ask not just about the flow of human capital to finance, but of the flow of finance to human capital—e.g. the huge financial rewards being captured by a very small percentage of people. This is actually pretty important because I think a lot of this question ultimately goes back to what kinds of work are valued, and who does it.
I don’t think Stanford students are actually that different from most students, other than that they tend to have more opportunities than most (although that perception can also be limiting—for example, the way in which teaching isn’t really seen as a legitimate career choice for many students outside of a couple of years of TFA). So in my mind this is how broader societal trends—financialization, but also the rise of insecure work, the rocketing of student loans—are playing out amongst the most privileged students. I think a more important question than “why do so many students from Stanford go into consulting” is “why do so many students in general think they have so few options, and are they right?” Unfortunately I think the answer to the latter is, increasingly, yes.
As a college education becomes more of an economic good, as it has to when tuition rates, and subsequently student loans and debt, are so high, the scope of jobs that we think are a good return on that investment becomes narrower. (Why don’t many Stanford students go into the military? Because most students go into the military to pay for college rather than the other way around; I’d be very surprised if a high percentage of students at most colleges, other than West Point, go into the military—although that may be changing as other opportunities vanish.
That Stanford and Harvard students going to finance/consulting in such huge numbers makes the headlines, and @38 may be right that such a large percentage of students at the best state schools don’t go into finance per se, but I think that in itself is a narrow framing of the issue. I actually suspect that most students are thinking about their post-collegiate lives in a very limited way, with the general category of business /accounting seen as one of few practical options. For example, twice as many students majored in business as in the next most popular major in 2008-2009, and that’s way up from even the 90s.
I don’t think students are just sitting around tallying up their projected income and the amount spent on loans; the calculus that goes into this is complicated and includes things like prestige, signaling, etc.—e.g., the cues students are getting from the broader culture—but the result is that some careers become recognized as practical options while others become riskier or more difficult or further off the beaten path or simply unknown. Eventually that becomes a self-reinforcing cycle in which students see only a few paths as legitimate or appealing—again, for a variety of reasons, many of which are outlined above. Of course, the job you take right out of college isn’t the end-all and be-all of your career, and people learn about jobs and sectors that weren’t obvious choices as college seniors once they’re out in the world, but still, I think the careers that people consider are relatively conscribed from the outset, as indicated by the NGO-Wall Street dichotomy that’s so often invoked.
I didn’t think very much about my career as a student, and I’ve nonetheless managed to spend the past few years doing work I think is interesting and important, but I also don’t think my path is particularly generalizable, or, for that matter, sustainable. I’ve managed to make enough to live on, but have relied on the support of friends and family in small but important ways—I’ve slept on a lot of couches and been treated to a lot of dinners. I’m very privileged to have been able to do the things I’ve done, but even so, it’s really hard to get paid a decent wage to do the things that I think are most important. Maybe that means the things I do actually aren’t that valuable to society; I guess that depends on how you define it. Anyway, I’m glad I never got used to making a lot of money, because knowing how to live happily on relatively little keeps my options open, but even so, there are some basics (again, health insurance, rent, loans) that present a real challenge if you want to start a tech company, freelance report from Cairo, write a novel, organize a social movement, or anything else that doesn’t offer you a stable income. That, in turn, has important implications for who is able to enter certain sectors, as the recent debate around unpaid internships points out–connections and privilege and getting your foot in the door does matter a lot in many of the “social good” sectors that have a less straightforward path (like journalism) or those that focus on a “culture fit” (like tech).
Anyway, I feel pretty strongly that this is not a Stanford-student issue, or even a student issue; it’s a social issue, and while I agree with @27 that it’s important for Stanford and other schools to support students in finding alternative career paths, I also think it’s imperative that we don’t just worry about where Stanford kids end up—we need to be asking what it would take for more people to be able to follow their passions/purposes, both individual and social. And that, to my mind, is a much bigger question. I really want to pull out what Mark says, via Jonny, about politics not being seen as a way to make social change: I actually think a lot of people want to make the world a better place, and when they’re told they can do something that will help people at a young age, like improving a company’s service delivery, they jump at the opportunity. But the consulting approach to social good is a technical, managerial one: the implication is that we just need to tweak a few things around the edges in order to optimize outcomes within existing systems. There’s much less support for thinking about social problems on a more fundamental level, or about more drastic changes and how we might make them–let alone for debating and tackling the business of social change in the public sphere (i.e. the sphere that is open to the general public) rather than the private. Anyway, I’ll stop there for now–thanks for reading and contributing, everyone.
43. Stanford student
The history of the American university is in a lot of ways a story about the competition for students, and one great way to attract students is to promise them they’ll have a job after graduation. One lasting result of this competition has been an emphasis on the role of the university as a site of professional training, which I believe is very much still the case today. I would definitely agree that there are normative arguments to be made that the role of the university should be conceived of more broadly than pure professional training, but those normative arguments shouldn’t obscure the fact that the college degree has often been seen as a first step to gainful employment.
One other small point I would like to make is that it is not immediately clear that TFA should be seen as a model for attracting students to service-oriented professions. The problem is that while TFA has certainly proven that they can compete with the finance and consulting industries in terms of student recruitment, we don’t know precisely why TFA has been so successful. If, for example, TFA’s most valuable recruiting asset is the prestige associated with the opportunities it offers students, then it may not actually end up selecting the students who are best qualified to work as teachers. Or perhaps TFA alums burn out and end up leaving the social sector? I don’t know the answer to either of these questions and would be interested in hearing from people who have gone through TFA, but I think both potential issues are worth considering.
I agree with @41 and Jonny about the problem with lumping finance and consulting together too much. In our efforts with Stop the Brain Drain, we’ve intentionally focused our critiques on Wall Street recruitment instead of consulting, because we do think consulting can play a much more productive role and offer great stepping stones for many graduates. (And I must say, in my work I benefit a lot from the research McKinsey produces, especially through the McKinsey Global Institute.) That’s not to say there aren’t real problems with the over-supply of management consultants (some of which David Leonhardt described in his latest Times feature, but overall I think the nature of those issues are different from Wall Street finance, as John describes well.
In terms of finance, it goes without saying we need a strong and efficient financial sector with smart and socially conscious employees. There are clearly plenty of young people who will use these skills to finance productive ventures and go on to pursue more socially responsible and economically productive activities. (In terms of these attrition rates from finance to more productive sectors, it would be great if the investment banks and hedge funds actually published this data themselves – certainly might help their public image if the data is any good.) For those young people already in finance or who are intending to pursue, they have an incredible opportunity right now to disrupt the status quo in those institutions and help make them more socially responsible and productive. I hope to see more of our friends and colleagues in the sector taking on this kind of productive, “intrapreneurial” role.
With that said, I think anyone who seriously believes we need more (instead of less) young bright minds going into finance instead of high-tech entrepreneurship, scientific research, applied engineering, and public service, is fundamentally out of touch with the problems facing our country. We’re still recovering from a financial crisis that nearly caused a second Great Depression and was caused in significant part by Wall Street financiers. Inequality is skyrocketing. The middle class is eroding. Rates of technological innovation and productivity growth are declining (as Tyler Cowen, Peter Thiel, and others have documented). Just today, the Wall Street Journal reported that the share of U.S. workers in scientific fields is declining. The Kauffman Foundation has already documented how this has damaged U.S. entrepreneurial capitalism.
More broadly, we face multiple crises in our country and world today that we desperately need more young people to proactively apply their talents toward solving – climate change, global poverty, education reform, historic levels of political dysfunction, rising levels of corporate oligarchy and influence over government, the larger deficit of national leadership, the list continues. If there was ever a time for a new generation of young leaders to step up, that time is now.
President Obama put it well in his December 2011 speech on inequality in Kansas, in which he called for a “New Nationalism” and declared that America’s future depends on attracting more young people into productive fields:
“If we don’t have an economy that’s built on bubbles and financial speculation, our best and brightest won’t all gravitate towards careers in banking and finance. Because if we want an economy that’s built to last, we need more of those young people in science and engineering. This country should not be known for bad debt and phony profits. We should be known for creating and selling products all around the world that are stamped with three proud words: Made in America.”
I love this.
A few quick thoughts:
1. A fundamental question here is “what is the role of the university?” We can debate what it should be, but the actual answer can be found in their founding charters / mission. These missions should to evolve with the times to some degree, certainly. That said, the idea that simply teaching people how to think is the goal does not jive with most founding grants. Stanford people – here is our founding grant.
2. @40 – thank you for chiming in. I get frustrated when people say there are no skills to be found in consulting. That is false. That said, two thoughts. a. Impact is not about what you touch, but what happens because of you. Bain has hundreds of talented people fighting for each spot. The project may have saved lives, but if you weren’t there, lives still would have been saved. This is also true of white house staffers, etc… not just private sector. We all need to think about the delta between us being there and not being there and using that metric to determine impact. That said, props if the project had good impact! b. You are participating in something I complained about above – sharing one project, and not the impact of all of them. I think you lamented, for example, working for a PE shop at some point. It is key to look at the range of impact. That said, I agree 100% with you point that consulting firms create positive value for society, and lumping them with the gambling elements of financial services is silly.
3. I agree with all of who have pointed out that determining whether something does some good or some bad is not that productive. What we need to do is say something like “What absolutely must get done for our society to succeed (as Teryn points out, and how do we allocate what is necessary)?” And then we need to direct financial capital, human capital, etc, to the issues.
47. Stanford student
I have never seen such a vibrant and passionate discussion on Facebook. However, can we have more of these conversations in classrooms throughout OUR campus? I hope that organic conversations like these can manifest into our academic curriculum where peers can share a common space to discuss these important topics beyond our various insular communities and circle of friends. Let us continue to organize more of these spaces.
Hi all, I’ve enjoyed following this discussion throughout. Jonny, I thought I would chime in on your point about the role of a university. I definitely agree that Stanford has a responsibility to encourage its students to be responsible citizens and contribute to the world in some capacity, especially in light of the tremendous privileges and opportunities we’re given. But I think Ezra Klein’s criticism of the liberal arts on these grounds is misguided. Cultivating skills like public speaking, working in groups, and breaking down problems is entirely compatible with an education focused largely on understanding the universe, the world’s problems, and the human condition – I can practice those skills in almost any class, as well as many venues outside my main classes. Furthermore, I think there are at least two important points about the utilitarian value of a deliberately liberal education that can be lost in conversations with people who are (admirably) already very committed to maximizing their social impact:
1) One great thing that thinking and reflecting simply for the sake of thinking and reflecting achieves is a habit of earnestness. In a sense, aiming to understand yourself and the world in college is a pushback against the organization kid mentality that leads graduates down paths merely for their prestige. A spirit of earnestness encourages us to ask: What is true? What is meaningful? And then pursue it. For people without an intense sense of personal and social responsibility on day 1, that’s especially important.
2) There’s an intellectual prowess and creativity of mind that’s best developed when you’re in the habit of pursuing a question without thinking the answer will directly apply to a practical problem. Think of Steve Jobs studying aesthetics at Reed College or going on spiritual quests with Indian gurus – things that probably helped make him a game changer at Apple. David Brooks once said of Barack Obama: “He can do the jurisprudence, he can do the political philosophy, and he can do the politics. I think he’s more talented than anyone in my lifetime.” If education is focused on learning how to think and then graduates pursue useful ventures with that heightened capacity, the world will be better for it.
My take is that, outside of learning how to think, there needs to be a university ethos of public service and pathways to make students more comfortable and equipped for pursuing socially useful careers upon graduation.
Also, I had the opportunity to serve on SUES (a task force reviewing undergraduate education), and one of the committee members wrote this about Stanford’s mission of usefulness:
“From the time of its founding, Stanford has oriented its undergraduate teaching mission around two large goals. In the Founding Grant, Jane and Leland Stanford sought to ‘qualify students for personal success and direct usefulness in life.’ The University’s first President, David Starr Jordan, took careful heed of this injunction to attend to students’ personal development and the practical value they bring to the world through their training. But he also introduced a second idea, which deeply colored his own understanding of the sort of usefulness university training ought to engender. He embedded this idea into the University’s motto, ‘Die Luft der Freiheit weht’ (‘The wind of freedom blows’), quoted from the sixteenth century humanist Ulrich von Hutten– a man who ‘dared to think and act for himself, when thought and act were costly.’ Guided by this motto, Stanford aims to promote wide ranging freedom of mind to our students, directly engaging them in the pure search for knowledge, regardless of its particular practical applications. This ideal places Stanford’s teaching mission squarely in the long tradition of liberal education, which holds that such study promotes a person’s ‘freedom for expansion and self-development.’ Free study is also an education for freedom.
Stanford’s distinctive, collaborative integration of the resources from all its various schools into the mission of educating our undergraduates arises from a sustained effort to blend these two ideals– usefulness in life and freedom of mind– into a seamless whole. As one of America’s most eloquent advocates of liberal education put it, ‘The function of the university is not simply to teach breadwinning…; it is, above all, to be the organ of that fine adjustment between real life and the growing knowledge of life, an adjustment which forms the secret of civilization.’”
50. Stanford Student
Great points @Aysha. Echoing @Alyssa earlier, “this is not a Stanford-student issue, or even a student issue; it’s a social issue….” VERY TRUE! And I will add that it is also specifically an educational issue.
It is not the solely the responsibility of Stanford and other elite universities to introduce alternative meaningful career path as some may have suggested, it is equally important for individual students to independently choose meaningful career routes that are nontraditional, often perceived to be productive and socially conscious. However, the current pedagogical framework fails to deliver this! From my experience, U.S. educational systems does not seem to value internal education as it does value the external education, and the consequence of this often leads to our brightest and most talented students entering financially rewarding careers.
Great conversation. Who knew Facebook could be such a great forum for this?
I have a proposal: to broaden the conversation and move it into a somewhat more public space, I’ll take the entire, now very lengthy thread, and place it up on my blog. I’ll do this on Monday, and I ask your permission to post with your name attached. If I don’t hear from you, I will strip your name from your comments and post it anonymously. If you’re okay with what you’ve written here being attributed to you, then let me know.
@Aysha, it’s interesting that you cite David Brooks here. While I think he’d agree with the need to focus undergraduate education on teaching young people how to think, he also suggests that introspection (a certain type of “thinking and reflecting,” as you put it) is not actually the right model for finding your calling. In one of my favorite Brooks op-eds of all time, “It’s Not About You,” he wrote:
“Today’s graduates are also told to find their passion and then pursue their dreams. The implication is that they should find themselves first and then go off and live their quest. But, of course, very few people at age 22 or 24 can take an inward journey and come out having discovered a developed self.
Most successful young people don’t look inside and then plan a life. They look outside and find a problem, which summons their life. A relative suffers from Alzheimer’s and a young woman feels called to help cure that disease. A young man works under a miserable boss and must develop management skills so his department can function. Another young woman finds herself confronted by an opportunity she never thought of in a job category she never imagined. This wasn’t in her plans, but this is where she can make her contribution.
Most people don’t form a self and then lead a life. They are called by a problem, and the self is constructed gradually by their calling.”
@Teryn, Brooks’s article was printed just a couple weeks before I graduated, so it was a hot topic with friends right around then. I agree with him that your calling calls you, though I would add the caveat that it’s helpful to choose to get out there and explore in both an academic and away-from-campus sense so it has a chance to find you!
All the same, getting a taste for the life of the mind while in college is an opportunity to suspend the organization kid mentality Brooks has described in other pieces and, when it comes to the humanities, it can help you get in touch with the “Big Shaggy”
And I still insist reflection is a good thing!
54. Stanford Grad
Jonny, Thanks so much for your thoughtful comments. On your point a), I agree that what matters ultimately is one person’s incremental difference in addressing a social problem. However, I don’t agree that consultants are interchangeable while social workers are not–if we stipulate that consultant interviews are a good indicator of performance (an aggressive assumption to be sure), on any given project a consultant is some degree better than the alternative, which leads to a measurable increase in lives saved / social value increased. If you take my full career into perspective, I wholeheartedly believe my incremental value to society is far greater due to my time in consulting (both during my time and from the skills I gained) than any alternative career path. On your point b), I’ve heard the point that consultants cherry-pick their projects when explaining their backgrounds, but I completely disagree. At any consulting firm, there is some range of choice based on what a person values–if you really value working in industrial goods, you can prioritize that, if you really want to work with a certain partner, you can select your cases based on that metric. For me, I wanted to work on projects I believed in, and in my 3 years in consulting I worked on a financial strategy project for the US State Department, an expansion strategy for a major international education NGO, a pharmacy adherence implementation, and a pharmaceutical company’s new drug strategy. Of those 3 years, only 2-3 months were spent working on projects I didn’t wholeheartedly agree with—on average I truly believed in my projects because that’s what I was selecting my cases on (I can only detail 1 example, but happy to explain all the others in person). I genuinely believe that if you take an evaluation of my life’s impact on society, my contribution was dramatically enhanced based on my time in consulting (the skills I gained that will be applicable later + the contributions I made while working in consulting). If there were an alternative career path that offered similar professional development and career opportunities to consulting with more social value I would instantly be on board, but I simply believe such an alternative does not exist.
@54, thanks for writing again. First off, I do not think a different standard should be placed on consulting than social services. That is why I referenced the White House too. Any highly competitive position has this same problem. That said, we should want people to compete hard for those highest leverage positions so that the very best serve in them. But once more — no double standard. I’m with ya. Second, I can’t give you many alternatives for building those same skills. I think they must be built, but for now I think you’re right that the consulting skills are hard to match. And some people only work on positive cases — it sounds like mostly the case for you! And you are becoming the perfect case study for what I think we should want: for those who go into consulting to go build those skills in a well spent few years, and to then move forward and apply them in creative, powerful ways where their presence creates a greater positive delta in the world.
[update: the following comments added in on 5/24/2012]
56. [Stanford Undergrad]
Wow, this is a really cool conversation. I know most of this focuses a lot on the supply side of students choosing these fields, but I’m also really interested in the question of why there’s so much demand for Ivy-educated consultants and financiers. It seems to me that as long as these firms are recruiting so all-out and offering well-paying jobs, the changes in student job choice we might achieve even if we hoped to would be pretty marginal.
In terms of this demand, for consultants it seems fairly clear that virtually every form of company, government, and nonprofit values their work enough to pay a lot of money for it. Arguing consultants aren’t providing value-added would mean a market failure involving a whole lot of smart people from all walks of life making very wasteful decisions with their money. Maybe that’s true, but I don’t know of any evidence for it. For bankers, on the other hand, there’s a pretty clear line of logic of why there might be more than the socially optimal level of demand. If we think banks consider themselves too-big-to-fail and engage in riskier activities than they would in the absence of implicit bailout protection, then the returns to being a banker might be higher than they should be and thus we might have too many bankers. If that’s the case, then it seems to me we’ll have too many bankers earning returns on socially useless risky behavior whether or not we convince potential Stanford-grad bankers to do something else. The only way to solve that problem (assuming it does exist) would be to reform the financial sector so it doesn’t take excessive risk and impose the occasional catastrophic recession on society.
And when we compare either of these professions or any other to public service, it strikes me that, as much as social or nonprofit work is a terrific thing to do, the supply of available positions will always be constrained by the amount of tax and donor dollars we choose to provide as a society to support their efforts. If every college grad wanted to do public service it would be impossible because private sector dollars via either the government or NGOs are ultimately required to pay for it. We might think government services or nonprofits are underprovided for, but that’s not the problem we’re solving by encouraging more people to go into public service when someone would still need to pay their (admittedly not very large) salaries. It’s possible there’s an undersupply of willing public servants to fill the available positions, but I’m not aware of any evidence to this effect.
I guess implicit in these comments is the question of whether we really think the distribution of Stanford/Harvard/etc. grads is the important thing or the distribution of college grads into jobs in general. I don’t think I see a reason why the choices of Stanford students would have an impact on the overall distribution of first jobs for college grads, given the factors I mention above, so I guess what I’m asking is this: Suppose the same overall number of 22 year olds go into banking/consulting/public service/everything else but a small portion of bankers get switched from Stanford to college X and a small portion of public servants get switched from college X to Stanford. Is that world a better place? If so, why? And if not, how is that not all we’re accomplishing by pushing students away from consulting and finance? (I could see pushing students toward engineering as a good reason because there does seem to be an undersupply of engineers)
57. (Stanford alum, working now on Wall Street)
Love the dialogue here. Rob, you and I have been having this conversation for years!!
Here is the main “problem”/ best quote of the Klein thesis:
“…colleges are producing a large number of very smart, completely confused graduates…”
I think this is actually a good thing…and this is not a problem at all!
I’d rather have a bunch of confused smart people than a bunch of smart robots. Colleges are supposed to teach, research, and advise (not sure of the order). I was a Philosophy/PoliSci double major, and there was nothing more that I wanted out of college than to be a better thinker. There is a certain amount of polish and finish that one is expected to gain upon graduating. If this wasn’t the case, employers would just recruit new candidates out of the top high schools.
What you might learn in a financial or consulting industry job can we very valuable later on in your life (Depending on your business line and responsibilities). In fact, I worked around a ton of humanities and arts majors…and probably connected more with them than say the Chemistry Phd’s. Also, not everyone stays in the business in perpetuity. Some stars cash out and start their own socially-conscious organizations. Some folks are lifers. Some tap out after two years and go back to grad-school to become lawyers and fight for civil justice. I would argue that skill-sets/concepts learned from these industries could be applied in VERY valuable ways in liberal arts focused industries.
It’s good to have a referendum on education (its healthy).
I guess what you want to focus on is if colleges are supposed to be vehicles to produce great and marketable resumes or great thinkers. (Perhaps a little of both)
***All the Practical people on one side of the room, and all the Fuzzy people on the other***
If liberal-arts-focused jobs are not recruiting as well as wall street jobs, then they simply need to get better! If you feel your education has “failed” you, I think it’s a cop out- somewhere down the line you probably failed yourself. You can’t blame schools…there are so many resources at schools these days- career programs, alumni networks, job fairs. Universities evolve and adapt just like the business world does.
It’s great if you know what you want to do for the rest of your life at 22 yrs old; however if you do not, there is nothing wrong with “figuring it all out” for a few years in the structure of the consulting/finance world…you might even be better at your next career for having done so. The concept of the Liberal Arts world “losing” folks to Wall street is a fallacy. You don’t work 80 hour weeks because you are confused…you probably like working hard, structure, and what you do. And, if you don’t like it, you will probably find something else to do. Liberal Arts focused jobs want people there who WANT to be there, so let them figure it out…sometimes it takes others a bit longer to do that.
58. [Stanford undergraduate]
On further reflection to my earlier post, I think the essential problem is not merely one of education but of perception. Somehow, whether real or perceived, the assumption is sometimes made that students who do not enter banking, management consultancy or law, are somehow losers, entering second rate professions. Perhaps, therefore, what universities should be doing is to help create a climate where other sectors of employment are given equal or preferred status. The other important issue at stake is that even if a large proportion of students enter these fields, many eventually leave with a lot of experience and enter more socially oriented fields. Acumen Fund for example recently advertised 10 positions open and got 1000 applicants with Wall Street backgrounds!