There’s no doubt finance is a prestigious industry. It’s highly paid, populated by graduates from elite universities, and perceived as being dominated by overachievers.
So how can such seemingly undesirable jobs be so prestigious? Amy Binder, sociology professor at the University of California, San Diego, who has studied how undergraduates learn to define “prestigious” jobs and why so many go to Wall Street, says that this is a false dichotomy.
“What I and my co-authors found that these jobs are both prestigious and a reasonable next step for people who haven’t figured out what their passions are or what they’d like to do with their lives,” she says.
Binder, who has mainly focused on interviewing undergraduates at Harvard and Stanford, says that many who go into finance start university with no notion of what investment banking is. “All of this interest is created once they’re on campus and there’s a few ways these jobs are talked about—marketed, if you will—to these students,” she adds.
Firstly, big banks are wealthy enough to commit large sums of money every year to coordinating with university career services. They host recruitment evenings and résumé drops, and become so ubiquitous that even those who never considered finance begin to question whether they should at least apply.
Though bombarding applicants doesn’t sound like a way of signaling prestige, Binder points out that major financial firms only host such recruitment events at the most elite colleges—Ivy League, Stanford, Chicago and, to a lesser extent, some liberal arts colleges and top public universities. “They target the campuses very carefully and the students know this,” she says.
Then there’s a process of “cultural matching.” Firms such as Goldman Sachs are careful to send alumni of a school to recruit on its campus. There’s even an effort to get alumni from particular college houses or sports teams to talk to current students from members of the same organizations. “There’s this real emotional and cognizant resonance that occurs between the students and recruiters,” she says.
And so students who don’t have another clear passion to pursue can come to see finance as the appropriate choice. Plus, though getting one of these jobs is hard, applying is made easy, so why not just throw your hat in the ring? And, just as Ivy League universities are considered a path to opportunity, finance jobs are presented paving the way for more options.
“You spend incessant time making Microsoft Excel spreadsheets, you’re at the mercy of your boss who can call at any time, but it’s only for a couple of years and it’s a great stepping-stone for future jobs. The students really believe this is accurate,” says Binder.
And who would be comfortable with the idea of working in a miserable job for the chance of future opportunity? Why, Ivy League graduates of course—after all, says Binder, “these students have a lot of experience with the idea of delayed gratification. They worked so hard to get into these schools, and that’s kind of what they’re doing now in these jobs.”