gogowoo

Hi,

Accordind to MIT career center's data, a considerable portion of MIT EE/CS graduates chose consulting or IB as their first job.

And I am wondering why they made such choices instead of being an engineer? Since 1) being an engineer makes better use of their IT skills developed through their many tough years at MIT 2) and IT companies like Google, Microsoft, etc pay quite well considering overtime is not as much as consulting and IB. 3) EE/CS students personality is more likely to be suitable for an engineering job.

Also, another thing I'm curious about is that for those MIT EE/CS people going to IB, do they take IBD, trader/sales positions or do they still do the IT jobs just in a different place?

Any comment is appreciated.

neuron39

When my son and I toured MIT three years ago, the tour guide was a senior Physics major. When I asked him what plans he had for the next year, he said "Goldman Sachs". The Wall Street hiring of MIT grads was entirely about money; hiring a "quant" was in on the Street, and in the view of most grads, the pay was an order of magnitude better in the investment world.
Obviously, the world has now changed. Jobs on Wall Street are scarce, the money is less for the jobs still available, and the grass is now green or greener in tech and graduate school. This will change again, but I doubt a college grad will be offered a high six-figure annual income as a 22 year old on the Street in the forseeable future.
My son is now a Physics/Computer Science double major, who plans to go to graduate school.

gogowoo

neuron39,

Really thanks for the sharing and insight.

I believe GS hires only the top grads in the class. And top grads are probably the ones who are really good at and love their major. For those people, it might be quite a hard choice to go to the Street instead of IT industry. But as you have said, maybe the compensation reward weighed so heavily when it comes to job decisions.

And, anyone has some insight on my previous second question? Since I saw Goldman Sachs, Morgan Stanley on the EE/CS grad's employer list, about how many of them do the IT job (so called Technolgy Analyst)?

Thanks, this forum is great with high quality answers.

sakky

Uh, Google and Microsoft pay overtime? If that were true, then their engineers would be truly raking it in. The old joke of Microsoft is that the company offered complete flextime: you could work any 14 hours of the day that you wanted...but with no extra pay. Google too is notorious for its long work hours, again, with no extra pay. If the boss tells you that he wants you to work on the weekend, then that's it, you've just lost your weekend for no extra compensation.

Well, the truth is, relatively few people will actually use whatever they majored in college within their career. Few history majors will embark upon careers that actually require history skills. Few English majors will embark upon careers that actually require knowing how to deconstruct poetry. Few math majors will embark upon careers that actually require deriving proofs. Hence, it should not be surprising to find some former engineering students who never become engineers.

Consider the following pics:


http://www.49ersparadise.com/goldrush/vain.jpg

49ers Champ's Incredible Fan Paradise Gold Rush

That's Ayla Vain, current fitness and dance expert and former cheerleader of the San Francisco 49ers, and former EECS major from MIT.

sakky

While I can agree that there are fewer jobs, I have to profoundly disagree with the notion that there is less money for those that have the jobs. If anything, there is actually more money.

THE state-owned Royal Bank of Scotland is planning to hand out record bonuses of up to £5m each in a snub to struggling taxpayers.

The average employee in its high-risk investment banking arm is likely to take home £240,000, with the top 20 staff in line for payments of between £1m and £5m.

The payouts by the investment banking division — from a total pay and bonus pot of £4 billion — would top the deals awarded at the peak of the financial boom in 2007 and are 66% higher than those paid last year.

Royal Bank of Scotland to pay record bonuses of up to £5m - Times Online

U.S investment bank JP Morgan is set to reward its staff with huge bonuses after it announced 'blowaway' profits for the last quarter of the year.

The bank posted profits of $3.6 billion (£2.25 billion), putting its employees on course for pay and bonus packages averaging around £300,000 this year.

The profits were much stronger than expected with the bank's 4,000 London-based employees leading its recovery from the depths of the financial crisis.

So far this year JP Morgan's investment banking staff have generated profits of almost $5 billion (£2.1 billion).

The generous payouts will come as a shock to those who thought that the credit crunch had put paid to the era of bumper City bonuses.
City bank Goldman Sachs is expected to confirm tomorrow that bonuses will smash all records in 2009, just a year after the Government rescued the financial system from oblivion.

The Wall Street giant is on course to lavish £14billion on pay and bonuses on staff this year following a surge in profits between July and September, experts said.

The expected payouts, far bigger than estimated earlier this year, have been fuelled by a record rise in the stock market and a revival in huge mergers and takeover bids.

Goldman's 5,500 UK workers are now set to pocket an average of almost £500,000 each for this year - the highest rewards in the firm's 140-year history.

JP Morgan staff in line for bumper bonuses after investment bank posts 'blowaway' profits | Mail Online

While many ordinary Americans are still waiting for an economic recovery, Goldman and its employees are enjoying one of the richest periods in the bank’s 140-year history...For Goldman employees, it is almost as if the financial crisis never happened. Only months after paying back billions of taxpayer dollars, Goldman Sachs is on pace to pay annual bonuses that will rival the record payouts that it made in 2007, at the height of the bubble. In the last nine months, the bank set aside about $16.7 billion for compensation — on track to pay each of its 31,700 employees close to $700,000 this year. Top producers are expecting multimillion-dollar paydays.

http://www.nytimes.com/2009/10/16/bu....html?_r=1&dbk

Major U.S. banks and securities firms are on pace to pay their employees about $140 billion this year -- a record high that shows compensation is rebounding despite regulatory scrutiny of Wall Street's pay culture.

Workers at 23 top investment banks, hedge funds, asset managers and stock and commodities exchanges can expect to earn even more than they did the peak year of 2007, according to an analysis of securities filings for the first half of 2009 and revenue estimates through year-end by The Wall Street Journal.

Total compensation and benefits at the publicly traded firms analyzed by the Journal are on track to increase 20% from last year's $117 billion -- and to top 2007's $130 billion payout. This year, employees at the companies will earn an estimated $143,400 on average, up almost $2,000 from 2007 levels.

Wall Street On Track To Award Record Pay - WSJ.com

Actually, it's happening right now as we speak. Granted, there are fewer jobs, notably because two banks went down. But the ones that remain are again hiring and, as seen above, paying higher compensation than ever.

sakky

I have discussed this topic numerous times on other threads; you are welcome to search for my old posts, especially within the engineering subsection of CC. The answer seems to be that engineering firms simply don't want to provide commensurate pay for top engineering students and don't want to provide them with strong future career opportunities. Instead, they would rather stick those engineers into cubicles consigned to relatively unexciting work that doesn't give them opportunities to advance quickly. Ultimately, the only long-term solution is for engineering firms to pay better and provide better opportunities, but most of them refuse.

Even at M.I.T., the U.S.'s premier engineering school, the traditional career path has lost its appeal for some students. Says junior Nicholas Pearce, a chemical-engineering major from Chicago: "It's marketed as--I don't want to say dead end but sort of 'O.K., here's your role, here's your lab, here's what you're going to be working on.' Even if it's a really cool product, you're locked into it." Like Gao, Pearce is leaning toward consulting. "If you're an M.I.T. grad and you're going to get paid $50,000 to work in a cubicle all day--as opposed to $60,000 in a team setting, plus a bonus, plus this, plus that--it seems like a no-brainer."

Are We Losing Our Edge? - TIME


Couple that with the fact that many engineering firms expect engineers to work long hours for no extra pay. Hence, those firms are trying to get something for nothing from their engineers, and nobody wants to give something for nothing.. Hence, many engineers determine that if they're going to be working Ibanking or consulting hours, they should be paid Ibanking/consulting wages, and if the engineering firms won't, then they should go to those firms that will.

molliebatmit

sakky, I'm surprised you didn't say this explictly, but I think one answer is "because they had the option to make such choices." Engineering majors at many other schools have no such choice available.

jessiehl

And you don't just have a choice, some of the firms will positively push themselves on you. I don't know if the economic downturn eased this a bit, but when I was an undergrad and went to career fairs at MIT, the consulting folks were all but mugging people to draw them over to those booths. They were like street canvassers, or those aggravating super-aggressive credit card salespeople in the airport. Meanwhile, the tech company people tended to wait at their booths for interested students to come to them.

I would certainly not pretend that this is the only factor in so many MIT students going into those industries, or the primary one, but I think it does make a difference.

sakky

I was trying to leave that implied.

MIT students - engineers or not - have far more career choices available to them than do students at the average school.

gogowoo

Quote:
I was trying to say that "IT companies like Google, Microsoft, etc pay quite well, considering overtime is NOT as much as consulting and IB." I agree with you that overtime is also a nuisance in IT. And that implies working 60 hrs a week as far as I know. But in IB or consulting it means 80 to 100 hrs a week, which is much worse.

Very impressive. Thanks.

gogowoo

Thanks. I will take a look.

So in other words, they don't really need top people. If they do, they would pay better.

But I doubt IB or consulting provides a better future. Only survivers finally became VPs or partners. What about a lot of those who didn't went up but went out?

jessiehl

Another thing, that I forgot to mention before: While I would not call it the norm, you sometimes see people get a lucrative financial-industry job right out of college, make a bunch of money for a couple of years, and then go into something else. Didn't (Associate Director of Admissions and blogger) Matt McGann do something like this? Or do I have that part of his backstory mixed up with someone else's?

sakky

Again, depends on the firms involved. To repeat the old joke regarding Microsoft: the company offers you flextime, you can work any 14 hours of the day you want. Electronic Arts recently settled an infamous court case regarding their overtime policies, but lack of overtime pay.

"The current mandatory hours are 9 a.m. to 10 p.m.--seven days a week--with the occasional Saturday evening off for good behavior (at 6:30 p.m.)," read the post, whose author claimed to be the "significant other" of an EA employee

Electronic Arts faces overtime lawsuit - CNET News

Now, I can agree that, in general, consulting and banking firms require higher time commitments than do engineering firms. But the kicker is that the most prestigious and desirable engineering firms often times run working hour policies that are virtually indistinguishable from that of the consulting and banking firms. Silicon Valley tech startups are notorious for their long working hours, so much so that engineers would never leave the office for days - even weeks - at a time, sleeping under their desks.

Some companies are trying to help employees adjust to irregular sleep. Fremont, Calif.-based portal GoYogi.com targets the global Indian population, which means employees have to stay conscious during daylight hours in India, as well as in the United States. India is 13 hours ahead of the U.S., so conversations usually start around 8 p.m. says Suneeta Krish, VP of business development. Krish says that so many employees were asleep under their desks one time that the cleaning staff thought street people broke into the building. To encourage employees to get enough rest, the company recently converted some of its offices into sleeping quarters.

CNN.com - Technology - Are sleep-deprived engineers hurting the Web? - June 12, 2000

sakky

Ha! They always want top people...but don't want to pay top rates. In other words, they're looking for bargains.

Don't get me wrong. Everybody wants a bargain. I'd like to buy a new Lexus for just $10k. But Toyota surely doesn't want to sell me one for that price.

I would argue that it definitely provides a better future. Most people in those fields fully understand that banking and consulting are mere waypoint careers to other jobs and that most won't make VP or partner. The exit strategy is simple: to obtain a nice job in corporate or public management or a VC/PE firm, many of which now require former consulting or banking experience.

Keep in mind that what we are comparing consulting/banking against engineering, and the sad truth is that most engineering careers don't really give you strong exit opportunities. The great advantage of banking and (especially) consulting is that it allows you to see a variety of different industries, be trained in a variety of different tasks, and network with powerful people who can help you land the job that you really want. In contrast, engineering jobs generally only train you to become an engineer (natch), but don't really allow you to progress beyond that.

For example, Bobby Jindal worked a stint at McKinsey and immediately afterwards - at age 25, mind you - was named Secretary of the Louisiana Department of Health and Hospitals, in charge of 40% of the budget of the entire state government of Louisiana, including the state Medicaid system. How many 25-year-old engineers would be provided that quality of opportunity?

Or consider 29-year-old Adam Storch, fresh from Goldman, who was recently named managing executive of the enforcement division at the SEC. Remember, this isn't a guy with 29 years of experience, but rather 29 years of age. How many 29 year old engineers are appointed managing executive of anything, much less the managing executive of a key Federal regulatory division?

http://www.bloomberg.com/apps/news?p...d=a6ItnK32Cl6Y

But hey, don't take my word for it. Talk to the people who took engineering jobs upon graduation. Talk to those who took consulting/banking jobs upon graduation. {To eliminate unobserved and confounding variables, talk only to those graduates who earned engineering degrees and either took engineering jobs or consulting/banking jobs.} Ask them about their career futures and the portability of their training. Then judge for yourself who enjoys better future opportunities.