The ‘Corona Class’ of 2020 Faces a Gloomy Jobs Market

Amid the worst recession in several generations, some employers are cancelling or deferring offers, but there are bright spots — and an MBA can be a boon

Jon Charles Gore is graduating this summer with an MBA degree from ESMT Berlin. He had hoped to work as a product manager at a tech company in the German capital. But such is the economic chaos caused by coronavirus, that he won’t even bother applying for jobs.

“At the start of the MBA, I was getting LinkedIn notifications for 30 director-level jobs in Berlin. Now it’s down to six,” he says.

Gore reckons he has better odds creating his own job, possibly through launching a voice technology startup. “Now is the time to take the plunge, despite the risks: it’s no longer reasonable to expect that everyone graduating this summer will be able to get a job,” he says. “We need to lower our expectations.”

The employment outlook for the “Corona Class” of 2020 looks gloomy indeed. They were headed into one of the hottest labor markets in decades before Covid-19 struck, but worldwide lockdowns to contain the disease have changed all that.

A global survey in May by the MBA Career Services and Employer Alliance showed two-thirds of 118 business schools reported at least one job offer for graduates was withdrawn. And 83 percent noted start dates were delayed, as companies transition to remote working and onboarding processes.

“All over the world, the job market is on the decline as companies are holding back on hiring due to uncertainties,” says Enna Tan, head of career services at NUS Business School in Singapore. “Even internships are either being delayed, shortened or cancelled.”

Bright spots on the job horizon

Like her counterparts at other schools, Sophie Schaefer, corporate relations manager at ESMT Berlin, warns against generalizations. She has observed hiring freezes among small and medium-sized companies and those in the tourism, automotive and manufacturing sectors, which have been hit hard by the crisis.

Yet there are bright spots: technology companies including Google, Microsoft, Facebook and Netflix continue to hire robustly, schools report. Amazon, for instance, has hired a record 1,000 MBA students worldwide so far this year, up 20 percent from 2019.

“There are companies that are now busier than ever and continue hiring,” says Schaefer. This includes banks, which are more resilient than other sectors thanks to regulation that followed the 2008 crisis, and consultancies, long leading employers of MBAs.

Bain & Company, for example, is upholding the job and internship offers it made to 600-odd MBA candidates this year, although most of its client work is now remote.  

Those searching for jobs are navigating online recruitment fairs, video interviews, remote onboarding — even entire internships at firms such as Goldman Sachs, Google and EY are being completed digitally.

The Boston Consulting Group has moved its coveted summer program — a key route to a high paying job at the firm — online. Interns will work on real client problems, network and receive mentoring.

Like at many companies, the BCG program has been shortened. This means graduates can fit multiple internships into the summer break, but employers have less time to assess performance and fit for a permanent role.

That, coupled with concerns over the quality of rushed online internships, means some employers, including Lloyds Banking Group, are canceling them altogether.

Firms that are keeping up recruitment are digitizing the entire process. Pre-corona, many companies were using video interviews for the early stages, but this is now the norm across the board.

Bernt Blankholm, chief executive of the European Foundation for Management Development’s careers service, Highered, says the trend will likely outlast the virus.

“Campus recruitment is not sustainable; you spend enormous amounts of money traveling around the world,” he says. “Virtual recruitment is more efficient, cheaper and lets employers expand hiring to schools they would, or could never have reached before.”

In June, his organization put on a virtual careers fair that drew more than 15,000 students from 90 business schools and 100 companies including McKinsey, Unilever and Standard Chartered.

New skills required

The digitization of recruitment and working practices is changing the types of skills graduates need to succeed in the job market, and the career support business schools provide.

HEC Paris, for instance, is running webinars on making an online job search successful, nailing virtual interviews, and building resilience to cope with the disruption caused by the crisis.

“One major change is the prevalence of home and remote working,” says Tony Somers, director of employer engagement at HEC Paris. “Graduates need to be more flexible in balancing personal and professional life. And, as managers, they have to understand and apply techniques to engage and motivate their teams remotely.”

Marie-José Beaudin, executive director of career services at McGill University’s Desautels Faculty of Management in Canada, adds that graduates will need to develop their emotional intelligence too. “They need to be particularly sensitive to and aware of the needs of those they interact with,” she says. “Written and verbal communication will be increasingly important.”

Stacy Blackman, an admissions consultant in the US, urges graduates to be adaptable. “In these uncertain times, grads need to be prepared to make career pivots, develop new skills and build relationships,” she says. “Being able to come out of the crisis on top will be impressive to recruiters in the future.

“And the ability to maintain a strong digital network will be paramount to securing a role.”

An MBA may help to sharpen such skills and provide an edge, but unemployment is still surging around the world.

And yet, business schools anticipate a rise in demand for their courses. An MBA is seen as a haven in such uncertain times, with workers flocking to full-time education in previous downturns to bolster their CV and land a job when the economy picks up.

However, graduating into recession can have a lasting negative impact. A report from the Resolution Foundation, a think tank, claimed the “crisis cohort” that entered the job market in the wake of the 2008 crash suffered higher unemployment, lower pay and worse job prospects up to a decade later, compared to those with more fortunate timing.

The crisis cohort was more likely to aim lower, which stunted its pay and prospects for a prolonged period of time.  

Gore at ESMT, who is American, was among this group: he graduated with a bachelors degree in finance in 2009. The jobs dried up on Wall Street, so he traveled to Africa, eventually founding a mobile money business that thrived across Kenya and Tanzania.

He will be hoping for similar success this time around, and is more optimistic about the prospects of the “corona class” than his 2009 cohort. “The productive assets aren’t gone,” Gore says. “The economy can be restarted pretty quickly.”

Image: Flazingo Photos / CC BY-SA 2.0 (cropped)

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