Steve Pollock is the president of WetFeet, a San Francisco-based company that offers research and services for both employers and job seekers. Before founding WetFeet in 1994, Pollock served as a manager in strategic planning and project finance for Mitsubishi International Corporation from 1985 to 1991. He earned his MBA from Stanford Graduate School of Business in 1993.
Pollock says on-campus recruiting is becoming increasingly competitive, as more retail companies duking it out with the investment banks and consulting firms to attract top talent. In such a competitive environment, companies need to do more to retain their promising summer interns, Pollock adds. He recently spoke with BusinessWeek Online reporter Jeffrey Gangemi. Here are edited excerpts of their conversation:
WetFeet recently released the 2005 Student Recruitment Report. What's the state of the current MBA job market?
This is the third year in a row that we've seen an increase in the average number of offers received by candidates. Everything is trending up since the low point in the 2001-02 school year.
First, traditionally big recruiters, namely the consulting firms and investment banks, have increased their number of hires. In 2004, the 15 companies that hired the most candidates from our sample population brought in an average of 16.5 full-time hires. This year, that average jumped to 27 new hires per company.
Second, more companies that don't have institutional on-campus recruiting efforts have been making the trip. We found that the number of employers who hired students from the survey population was about 20% higher than last year.
What kinds of companies are going to campus for the first time?
Many boutique players from asset-management firms, hedge funds, and private equity firms, as well as smaller consulting firms are going to campus. Also, some retail companies have instituted more aggressive MBA recruiting techniques. For example, Target (TGT ) made a big splash on campus this year by giving away scholarship money. Home Depot (HD ) has some leadership-track positions for which they're recruiting. And JC Penney (JCP ) is setting up recruiting at some top-tier programs as well.
How important are internships to companies?
They're hugely important. Companies are continuing to dedicate more and more resources to internship recruiting, even at the expense of their full-time efforts. This year, for example, I've heard from several students that, despite declining an internship offer from a particular employer, they still received a full-time offer from that company at the start of this year's recruiting season. The company was so confident in their internship recruiting process that they didn't even require the student to interview again.
How do students view internships differently than recruiters?
There's a real disconnect between candidate and corporate interest around the internship. Companies see the internships as tryouts. The No. 1 rationale for corporate internship recruiting is to build a full-time candidate pipeline, especially at the MBA level.
Many students, on the other hand, are getting their MBA to change careers, and the internship is an opportunity for them to experience a different industry or employer. They have competing objectives, compared to corporate employers, who are focused on building that pipeline.
Companies need to do a better job of retaining their interns. Of the 61% of this year's survey respondents that reported receiving a full-time offer [from their internship employer], only 40% said they planned to accept it.
How have students changed in their approach to the job search?
Two years ago, students were more willing to look around and to submit resumes to companies that might not have been their first choice, just because they wanted to have a back-up option. This past year, we saw a drop-off in the application activity of candidates, suggesting that they're more confident and accepting offers sooner (see BW Online, 7/15/05, "Just-in-time Jobs").
What makes some of the top consulting firms so attractive to students, aside from the fact that they hire many people and pay well?
They've done a phenomenal job of fine-tuning their message to MBAs. They talk about consulting as being an opportunity to continue learning and increase experience and exposure by working on projects at large, prestigious companies. They frame the kind of work they do as being high level and strategic, thus requiring the best and the brightest candidates. And, of course, they offer a compensation structure and perks and benefits that attract people's attention.
People are going through many career changes today, but they see consulting as a great option after school because of the exposure they can get to many interesting business problems. Also, with all the debt they've acquired by going back to school, a few years of consulting becomes financially appealing as well.
Which companies made a splash with innovative recruiting activities this year?
Every year, there are a few companies that do breakthrough marketing programs or events that generate buzz on campus. This fall, Boston Consulting Group gave branded iPods to all of their summer interns. Booz Allen Hamilton took all of their interns to the Booz Allen Classic golf tournament.
I also heard that Abercrombie and Fitch (ANF ) sent handwritten notes and T-shirts to a number of candidates who they wanted to interview because of what they've seen on their resumes. That's not necessarily a very costly activity, but it does demonstrate that the company gave attention to one individual and that can be persuasive. I've even heard of some companies taking students snowmobiling.
Is there more and more pressure for companies to send their top people to campus?
It really varies by company. At General Electric (GE ), for example, they have a whole selection process for the recruiting team. There, recruiting is seen as a desirable position, and if someone gets bad reviews, he or she won't get asked back. Other companies have trouble getting anyone to go.
Are there any hot places to work right now?
Invariably, the industry that's currently considered the hottest tends to fall off the table the following year. Just because an industry is hot doesn't mean it has staying power.
We have seen a ramping up of recruiting activities from some of the more established Internet and tech companies, like eBay (EBAY ), Amazon.com (AMZN ), and Google (GOOG ) (see BW Online, 7/15/05, "Building the Bid-ness at eBay").
Looking forward, I really think that we're going to see a fairly strong market for candidates. We're already seeing some pressure on companies to increase compensation levels. I heard that one of the investment banks just raised its starting offers for undergraduates.
Because of a greater demand for candidates, corporate yields are going to go down. We'll see many companies somewhat disappointed in the number of people that they're able to hire.