Why investment banks are hiring 20-somethings with this qualification, rather than 30-something MBAs

If you’re tossing up which qualification to go for to get a job in an investment bank, maybe an MBA is not the way to go. Instead, you might want to opt for a Masters in Management, which is still feeding a huge proportion of graduates into finance.

23% of London Business School’s MiM graduates this year ended up in investment banking. Within its MBA class of 2016, however, just 7% ended up going into M&A roles.

But, there are a couple of important differentiating factors here – age and cost.

Most LBS MiM students have just one year of work experience and their average age is 23. Meanwhile, LBS’s MBAs were 24-39 and had five years’ work experience.

What’s more, MiM students going into finance earned an average of $63k salary and a $12k bonus. MBAs securing an associate banking job, meanwhile, earned total compensation of $162.3k.

MBAs are often choosing to stay away from investment banking jobs, and investment banks are hiring fewer of them.

But a common complaint from MBAs is that the work of an associate is not interesting enough for their educational background, while investment banking juniors suggest that MBAs don’t have enough technical knowledge to be of use.

Maybe hiring a 23-year-old with a top notch degree under their belt on an analyst’s salary is the way to go.

Contact: pclarke@efinancialcareers.com

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