Fluctuations in the US economy are not affecting career choices or even summer job prospects among recent MIT graduates, partly because graduate school offers a way to outlast the current downturn.
Noah Bray-Ali, a senior in physics and mathematics, said he had "considered taking time off after graduation to work, but having found no promising leads, continued ahead with plans for graduate school in physics in the fall." Thus, his immediate plans "don't reflect the latest economic indicators."
Amay N. Champaneria, a senior in computer science and management science, is heading for a summer internship at Microsoft. In the fall, he'll pursue graduate studies to better position himself in an increasingly competitive job market.
"Though the current economic picture didn't affect my overall career goals, it made me realize that I'm going to need something extra to attain the job and salary I want," he said, noting especially the "abundance of available software engineers from failed dotcoms and downsizing corporations."
Accordingly, Mr. Champaneria said, the recent economic downturn "made me more willing to stay at MIT for graduate studies, since academia is somewhat insulated from the risky economy."
Students recruited before the stock market's recent drop and those who will be working in large, traditonal firms may share that sense of relative shock absorption.
Rayan M. Fayez, a senior in mechanical engineering, has a job as an investment banking analyst at JP Morgan Chase. The mercurial stock market has not affected her personally, she said.
"Our class was lucky. The recruiting started early in the fall before the major economic slowdown started. Also, a huge firm can absorb the cost of entering analysts without much harm done," she noted.
The effect of a moody business cycle on investment banks may not reach employees until December 2001 or later, she said. "The entering positions at all investment banks are almost identical. But poorer-than-average performance by investment banks could cause alower than average year-end bonus," she said.
Ms. Fayez also noted that the recruitment process is a mutual investment; goodwill is essential on both sides. While JP Morgan and its ilk may have considered retracting job offers to MIT graduates, the better long-term strategy for such firms is to nurture their relationships with MIT.
"JP Morgan recruits so many MIT graduates that pulling back offers would hurt their recruiting activities in the following years when the economy rebounds," she said.
Ahmed Elmouelhi, a senior in mechanical engineering, turned down several offers from large firms in order to finish his SM degree at MIT; he felt no effect from the slowing economy and does not expect to. "All the recruiters were as eager as ever to get the best MIT graduates. It seems that as long as you're at the top of your field, you will always be in demand," he said.
Some graduates said they see the contracting US economy as likely to affect the career plans and course choices of next year's senior class.
"This fear or concern about the job market wasn't present previously since all sectors were strong," Ms. Fayez said. "For example, the number of people going into startups has massively decreased compared to two years ago, while the number of management majors has significantly increased this year. The economic slowdown can drive students to study something that would lead them to safer career paths, such as banking or consulting, instead of to the riskier startups that people could afford during strong economic periods."
David Strozzi, a graduate student in physics, noted that undergraduates he knew were "extremely attuned to the happenings in 'hot' areas of the economy like dotcomland, consulting, investment banking. The fact that over one-third of MIT undergrads choose electrical engineering and computer science indicates that people are gearing their major choice based on job prospects," he said. (Technical jobs are expected to grow significantly in the next seven years.)
Mr. Strozzi's income, a monthly fellowship stipend from the Department of Defense and MIT, was determined last year for the next three years, including "decent increases every year," he said.
Thus, the economic downturn has had "zero noticeable impact on me, except for generating hot air from various Republican politicians."
A version of this article appeared in MIT Tech Talk on June 6, 2001.