MBAs: Uncle Sam wants you

Author: Anne VanderMey

At the McCombs School of Business at the University of Texas at Austin on Feb. 9, dozens of students crowded a classroom for an evening career workshop, breaking an attendance record. The scene was typical of B-school campuses across the country -- with jobs in short supply, recruiters are finding themselves more courted than ever. What was different, though, was that this wasn't an event for investment banking, management, or even consulting. It was a pitch for nonprofit and government work.

Uncle Sam has never been very popular with MBA graduates, most of whom are accustomed to the hefty signing bonuses and competitive salaries in private industry. But with the U.S. shedding hundreds of thousands of jobs each month, many companies freezing wages, and an MBA job market turning more dismal by the minute, the stability of government is starting to look a lot more appealing.

At McCombs, Director of MBA Career Services Stacey Rudnick said 70 people came to a workshop called "MBA Jobs You've Never Considered," the largest turnout in recent memory for a spring career workshop. Usually, by this time of year, students already have jobs lined up. "Students are looking for every opportunity, every bit of new information that might help them extend or broaden their search," Rudnick said.

Luckily for MBAs, the interest is mutual. Career services directors predict that government and nonprofit hiring will increase this year, though it's too early to say by how much. According to recently released data from the Career Services Council, 35% of schools reported an increase in recruiting activity for government and 12% reported an increase in the nonprofit sector, even as overall recruiting activity was level or down at 75% of schools. Net Impact, a nonprofit group dedicated to using business skills to affect change, said social sector job postings more than doubled last year. The recruiting Web site for the U.S. government lists tens of thousands of vacant business-related positions, and with an incoming administration bent on job creation, that number is likely to grow.

Better than Nothing

Business schools have already been seeing some movement toward nonprofit professions, though historically those students have been outnumbered by investment bankers and consultants. Few new graduates -- 4.4% last year -- typically take positions in nonprofits or government, says Kip Harrell, president of the CSC and vice-president for professional and career management at Thunderbird School of Global Management. However, the financial crisis and the scarcity of six-figure offers, could accelerate the do-gooder trend. Patrick Perrella, the director of MBA career development at the University of Notre Dame Mendoza College of Business, broke it down this way: It's an easy decision "if your choice is a government job at a lower salary or no job at all."

The salary disparity may be narrowing, though. A recent survey by the Graduate Admission Council reported that about 80% of nonprofit and government respondents were actually poised to raise incoming MBA salary in 2009, by far the most of any group. However, they also had by far the lowest salaries, with average starting pay for MBAs just $63,176. For consultants, it was $92,931.

Even a slight decrease in private sector pay may be enough to tip some graduates toward idealism, though. Vanessa Leong, a 2008 graduate of the George Washington University School of Business, always wanted to make a difference, but isn't sure if she would have taken her current, nonprofit position if the economy had been better. "If I had really had offers and offers pouring and pouring in with big, big money, there's a chance I wouldn't be here," she said. She's now living in Lesotho, a small country in Africa advising the country's ministry of health on the efficiency of HIV/AIDS programs through the Clinton Foundation. The program pays "literally half as much" as some of the offers she received from mainstream consulting companies, but she hopes the experience will set her up for an ever more influential, better paying position in the future. Still, she said, in her B-school days she had imagined working in Washington when she graduated, not living in Africa in a house surrounded by fences topped with barbed wire and a guard keeping watch at night.

An Odd Couple

Government and nonprofit jobs typically aren't as glamorous as those in private industry, and public sector hires can bid farewell to their dreams of riding on the corporate jet. A few jobs listed on the federal jobs Web site include finance director for a sculpture garden, accountant for the Army Corps of Engineers, and bankruptcy analyst for the U.S. Trustee Program in Greenbelt, Md. Other federal agencies are seeking accountants, tax examiners, auditors, and budget and financial analysts. At the nonprofits, there are also a wide array of roles for MBAs. Many smaller nonprofits have only one employee with a business education, and that person often handles all the organization's finances.

Public sector jobs are in especially high demand as a wave of baby-boomer retirement hits the federal government. With more than 200,000 new government jobs expected as part of President Obama's economic stimulus plan, the number of positions available to MBAs and others is sure to grow. The government bailout of banks, and the regulatory push that's sure to follow, both represent real opportunities for MBAs. "Somebody's got to redesign the governmental rules of the financial market and someone has to oversee the redistribution of the government funds," says Jeannette Frett, assistant dean and director of MBA career services at Georgetown University's McDonough School of Business, where student interest in nonprofits and government is up 50% this year. "It's an opportunity for those who were interested, and continue to be interested in pursuing careers on the financial side."

Because MBA graduates and government or nonprofit positions are not a typical match, connecting students and recruiters poses more of a challenge than it does for companies that base their hiring cycles on the academic year. While several federal agencies make the occasional campus visit, much of the impetus for finding government jobs falls on the shoulders of the applicant.

"The federal government is a terrible recruiter, that's the bottom line," said Max Stier, president of the Partnership for Public Service, a nonprofit group which promotes federal employment. Of course, some agencies are better than others. The intelligence community is proactive, Stier says, as is NASA, and the Labor Dept. has an MBA fellowship program, but these are the exceptions to the rule. Most government recruiting takes place on the only official federal recruiting site,

In dark times, though, sifting through search results on, doesn't seem like much of an obstacle. Career services directors, too are making an extra effort to connect with nonprofits and government, as they continue to be relatively unaffected by the hiring slump. More schools than ever are signing up for the Partnership for Public Service's "Call to Serve" training, aimed at demystifying the government application process and other campuses are setting up their own nonprofit and government recruiting workshops.

Rebecca Joffrey, co-director of career development at the Tuck School of Business at Dartmouth College, said that for the first time she would be heading down to Washington to learn more about government jobs by talking with alumni in high-level government positions. Even after the financial crisis is over, she hopes that the new, stronger connection between business schools and nonprofits and government persists. Jennifer Brooks, senior associate director of the career management center at the University of North Carolina at Chapel Hill's Kenan-Flagler Business School, says she thinks a wider array of career options may be MBA students' silver lining in the financial crisis.

"(Students) want jobs where they can make an impact," Brooks said. "And they want jobs. That's No. 1."