“You go in with this dream of what consulting is,” said Nathan, a Yale student whose name has been changed and who spoke to The Politic under conditions of anonymity. “And you can quickly become disillusioned because it is just another corporate environment.”
And a corporate environment with decreasing opportunities, at that.
From June to August 2023, Nathan interned at Boston Consulting Group. He contributed to three projects during the ten-week program. “They focus heavily on the intern experience,” he said. “I can’t say the same thing for full-time associates I was working with—many of them were on the beach, or not able to get casework very easily.”
This trend is not specific to BCG. For the first time in years, there is a decline in corporate demand for consulting services. In a recent survey of 100 U.S. consulting clients conducted by the firm Source Global Research, 65 percent of respondents stated that they have halted the majority of their consulting projects and 75 percent have canceled some. This decrease in projects leaves already-hired associates with little to do. Instead of answering emails, providing strategic advice, or refining the slide deck for their upcoming deliverable, young consultants are being paid to exercise, watch Netflix, and catch up on sleep.
“Entering the consulting field, I sort of had this idea that recessions do not affect consulting firms,” Nathan explained. “But this has very much changed in the past year or so.” Until recently, there was a widespread belief in the constant need for advice regardless of economic conditions. Nonetheless, the most recent slowdown in the economy reduced discretionary spending by consulting clients and their consumers. This, in addition to elevated interest rates that constrain lenders from financing deals, has significantly altered the consulting industry’s clientele and appetite for projects.
Lower client demand coupled with overhiring during the COVID-19 pandemic has left consulting firms with no choice but to let employees go. Although consulting firms are hesitant to acknowledge lay-offs as the remedy, the numbers speak for themselves. In March 2023, McKinsey announced their plan to cut 1,400 roles, comprising one of the biggest rounds of cuts in the firm’s history. A month later, Deloitte and Ernst & Young fired 1.5 percent and 5 percent of their U.S. staff, respectively. Then, in June, KPMG International cut about 5 percent of its U.S. employees following a 2 percent reduction four months prior. While these lay-offs were heavily focused on advisory, tax, and back-office staff as opposed to client-facing jobs, these trends nevertheless affect prospective consultants.
Every year, hundreds of Yale students dream of becoming a consultant in New York City or another metropolitan hub. The consulting recruitment process is often perceived as one of the most stable and predictable ways to get a post-grad job offer—one that comes with a cushy baseline salary of over $100,000. As outlined in the 2022 Peer Networking Class List, 22.3 percent of graduates in the Yale College Class of 2022 went into consulting.
But the current climate has muddied this assumption. Receiving an offer was already competitive before the current slump. Now, in 2022, McKinsey & Company received one million applicants for 10,000 full-time roles. Bain & Company (Bain) and BCG—which, along with McKinsey, comprise the “Big Three” of consulting—have reported comparable rates.
Unable to offer recent hires substantive work, these firms have turned to offering incentives in exchange for delayed start times. Bain, for example, has told M.B.A. recruits who delay their position that they can earn $40,000 to work for a nonprofit and $30,000 to learn a new language in the meantime.
Many aspiring consultants fear these postponed start times—in combination with layoffs and a scarcity of projects—will intensify competition during the upcoming application cycle. College juniors face heightened pressure, realizing that even securing an internship does not mean success as interns no longer have the assurance of a return offer.
“When I started my internship, there was this notion that every intern would get a return offer,” Nathan recalled. “That is how it has been done for the past two to three years. What changed for my cycle and the ones to come is that it is not a guarantee anymore, which I think soured a lot of interns’ feelings about the industry.”
For the Yale students who are not deterred by these industry trends, membership in an undergraduate consulting organization seems more important than ever. Consulting clubs receive huge amounts of applications every year—YUCG reports that on average, they accept fewer than 10 percent of applicants. This year was particularly competitive: the majority of consulting organizations at Yale, such as YUCG, Tamid at Yale, and Yale Net Impact, experienced significant upticks in their application pools. Joining these organizations is often portrayed as a critical step in the recruitment process, leading students to believe their career in consulting is over if they are not admitted to a particular club.
Matthew Park ‘24, who serves as the president of YUCG, who serves as the president of YUCG, emphasized that membership in a consulting club does not necessarily guarantee success in the recruitment process.
“There is only so much consulting groups at the collegiate level can do besides expose its members to what work at these firms is like,” Park said. “The real challenge is accessing the other resources Yale provides and taking the initiative to seek out what you need.”
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The Yale Office of Career Strategy (OCS) aims to work with Yale students and alumni to help define career goals, identify opportunities, and provide robust support throughout the career development journey.
“OCS offers the following: job search support, recruiting events, peer-to-peer networking data, labor market insights, and the Designing Your Career tool – an online tool that applies design thinking principles to career decision-making,” Denise Byrnes, the Associate Director of Employer Relations at OCS, wrote in an email correspondence to The Politic.
These resources are particularly robust for students interested in the consulting industry. OCS frequently partners with the “Big Three” companies, holding webinars, networking events, and coffee chats with Yale alumni across various job levels who are enthusiastic to pay it forward.
Despite these offerings, students worry that even these impressive institutional connections between Yale and consulting firms can no longer help secure a position. One Yale student, speaking anonymously to The Politic for fear of possible ramifications from future employers, said that “the majority of [OCS] materials are antiquated, and their events at the Omni Hotel are not useful, and everyone knows it.”
Vinh Tran ‘25, the Head of Consulting for TAMID at Yale—an Israeli investment and consulting organization—echoed this opinion. “OCS provides a peer networking list, although it is not particularly effective,” he said. “There are also resources for technical preparation, but I have often had to seek elsewhere for sufficient preparation.”
These feelings are amplified for underrepresented students, especially first-generation low-income students. “I had no idea where to look,” said Jason, a first-year associate at BCG ‘23 who spoke to The Politic. Jason’s name has been changed to keep his identity anonymous. “I would have never known where to go if not for my friends telling me how to case, write cover letters, and format my résumé.”
Reflecting on his recruitment process, Jason spoke about some of the pressures on students to be ultra-competitive. “When students are casing different people – helping them prepare for consulting interviews – there is an understanding that they’re going to be competing against them further down in the pipeline,” he explained. “Students will purposefully gatekeep resources in an effort to keep the industry insular.”
He credits his membership in SUBE, a pre-professional student association dedicated to empowering Hispanic and Latinx students in fields where they are underrepresented, with removing some of these toxic elements from his job search. “Luckily, I was a member of SUBE, where I was provided the information I needed to succeed,” he said.
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Given the amount of obstacles applicants must face during and after recruiting, why does the consulting industry remain so popular amongst Yale students?
Jason highlighted a plethora of reasons for entering the consulting field. When exploring different career paths, he felt strongly about choosing an industry that consistently challenged him to improve: “Every person that works here would say their output now compared to a year ago, six months ago, has improved. We are better time managers, more biased towards action and we owe these qualities to consulting.”
He also emphasized the endless databases of consulting firms that are readily available to their employees: “This is a common theme across banking, consulting, and high-stress, high-intensity industries,” Jason said. “Yes, they throw you into the deep end but they give you the resources to stay afloat.” While he engages with the majority of BCG’s resources, such as skill training and interviews with sector experts, after-hours to ensure he is present in the office, he does not mind extending his work day: “I want to show I am a sponge, willing to learn, and put in the work. That is why I find it easy to justify the long hours because, as a first-year analyst, I have little to offer but long hours.”
Additionally, with a turnover rate of two to three years, consultants are constantly transitioning to other industries. The source of this transition varies, with some consultants seeking a better work-life balance, an education at an elite business school, or job mobility: “I have a name, and now I have corporate clout and can move around,” Jason said. “Consultants have a robust network of people who are likely to be successful in whatever they do.” This holds true; 47 of the Fortune 500 CEOs are former management consultants.
Many consultants face accusations of “selling out,” with peers disapproving of their working for large corporations in exchange for a paycheck or tuition to business school. However, Park said this rhetoric was not a major concern for him. “People can call it whatever but, I mean, it is an interesting career and interesting work. It also happens to have good pay as well. So yeah,” he said, laughing. “I’m not too bothered.”
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Prospective consultants are now faced with the question: do traditional motivations for entering the consulting industry remain appealing amidst industry trends?
Jason achieved his full-time job through BCG’s Bridge to Consulting Diversity Workshop, an immersive, pre-professional program for underrepresented minority groups that guarantees participants an interview for the summer internship. This, along with the nature of his particular sector, has prevented his consulting experience from being heavily affected by these conditions. However, it has been hard for him to watch his friends struggle: “The industry will weed you out…I have friends at other consulting companies who heavily considered leaving because they would be ‘on the beach’ for unreasonable amounts of time.”
Nonetheless, aspiring consultants are determined to make it. “The conditions are not ideal but I’m not discouraged. I have always liked the idea of breaking down a problem into its components and then trying to build out a solution that is data-driven and benefits others,” said one of the students who spoke to The Politic on condition of anonymity.
Tran, who is currently applying to consulting internships, agrees. He tends to block out the external factors and focus on what he can control. When asked if the industry trends scare him, he chuckled and replied, “Not at all. The only thing that deters me is rejection.”
While confidence is certainly advantageous in the consulting industry, Yale students may discover that concerns about industry trends are more substantial than they initially perceive. Embracing a blend of assurance and strategic awareness could better equip Yale students to navigate the intricate and ever-evolving landscape of the consulting industry.