Why banks are quietly happy to reject your application

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Banks, technology companies and universities have really elevated their game with a rather strange form of public boasting: how many doors they slam in people’s faces. Low acceptance rates are what’s hip in the streets these days it seems.

Blackstone Group was the latest to pat itself on the back for telling graduates to hit the road. And not through a press release or media flak. Its co-founder, 68-year-old billionaire Steve Schwarzman, delivered the news on last week’s conference call, telling analysts and investors that Blackstone hired just 100 of the 15,000 people who applied to become a junior analyst. That’s a 0.7% acceptance rate.

“It’s six times harder to get a job as an analyst at Blackstone than getting into Harvard, Yale or Stanford,” said Schwarzman, who owns degrees from both Yale and Harvard Business School. He also called the private equity firm an “earnings machine,” which it certainly was during the first quarter.

On the surface, it’s a bit odd to brag about crushing the dreams of 14,900 people, but acceptance rates have become a key metric. Goldman Sachs is always happy to offer up theirs – last year they received 270,000 applications for 8,300 positions, or a 3% acceptance rate. Morgan Stanley said last summer that it accepted just 2% of its 90,000 summer analyst applicants.

But none stack up to Wall Street’s West Coast nemesis. Google receives roughly 3 million applications per year, making around 7,000 hires. That’s a 0.2% acceptance rate.

Colleges and universities aren’t immune to the pressure. In fact, low acceptance rates are held in even higher regard in the Ivy League than they are on Wall Street. Harvard was happy to boast about its record-low 5.3% acceptance rate, which seems to fall each year.

Several reports have been published recently that suggest colleges and universities are recruiting subpar students with the specific intent to reject them just to improve their percentages. Surely banks aren’t doing the same – the recruitment process is far too costly – but they’re nonetheless happy to say no and tally up the numbers.

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