Private equity outpaces banks in scramble for graduate talent

With mergers and acquisitions activity at a two-decade low, and the market for initial public offerings showing renewed strength in the US but weakness elsewhere, finance graduates face a job market this summer that is lean and uneven.

For students in masters in finance programmes, the slowdown in investment banking has pushed many to broaden their search beyond legacy roles. Experts say advisory hiring has cooled, and competition for places at bulge-bracket banks is intensifying.

Lee Thacker, a partner at London-based executive search firm Silvermine Partners, takes a bearish view. “Junior roles for grads . . . are extraordinarily quiet,” he says. “[We’re] seeing 5,000-plus applications on any junior roles we work on.”

That glut, he says, lays bare how far graduate hiring has fallen — a drop he links in part to the rapid advance of artificial intelligence. “Why hire 100 grads when a $300,000 licence can do the same work?” he adds, pointing to AI as a cheaper alternative to traditional analyst teams.

The big banks have trimmed early-career hiring in response to sluggish deal activity. Bank of America cut 150 junior investment banker roles in early 2025 amid weaker-than-expected volumes, as part of its annual review process, with most affected staff redeployed elsewhere in the firm.

Meanwhile EY, the accounting and professional services firm, has postponed start dates for new hires in its US strategy and deals arm for the third year running.

In a sign of how competitive the market has become, Goldman Sachs recently disclosed it hires only 1 per cent of the 875,000 applications it receives annually.

Other banks, however, have held their ground. “We have not changed our early-career hiring strategy for finance graduates within M&A or capital markets,” says David Oram, campus recruitment partner for global markets at BNP Paribas, the French lender. He points to continued demand in relationship-driven roles within global banking and sales.

Yet while some lenders stay the course, private equity firms are moving faster. Buyout groups such as Apollo, KKR and TPG are accelerating recruitment timelines, offering roles to undergraduates and recent graduates with little full-time experience — often years before they formally enter the workforce.

The hiring race has intensified competition with Wall Street banks and is prompting some job candidates to rethink their career strategies.

At Skema Business School in France, students are increasingly broadening their targets — looking to private equity, risk and capital markets — as deal activity slows and opportunities emerge beyond traditional investment banking.

“When the environment translates into lower M&A deals globally, our students do explore alternative opportunities beyond M&A analyst roles,” says Pascale Viala, the school’s corporate office director.

At the University of Cambridge’s Judge Business School, where the MiF is designed for those with prior work experience, investment banking remains the dominant destination.

But Pedro Saffi, professor of financial economics, notes a geographic shift, with more graduates accepting roles outside the UK as domestic deal activity slows.

Only 48 per cent of graduates took roles at UK-based firms this year, down from 64 per cent a year earlier. “This indicates stronger demand in global financial hubs and a slower capital market in the UK, where IPOs have plummeted,” says Saffi.

Placement rates remain strong, with nearly 90 per cent of last year’s cohort securing roles within four months, but hiring has become more selective.

“The policies of the current US administration have had a significant impact on the financial services sector. The uncertainty regarding tariffs has affected deal flow, and many banks and consulting firms are waiting to see what will happen,” says Saffi.

Similar caution hangs over Hong Kong, the Asian financial hub. According to Raymond Xiao, head of MSc career development at HKUST Business School, front-office roles remain limited and employers are becoming more selective.

“The market remains uncertain, and employers from global financial firms are becoming more cautious in terms of cost control,” he says.

That has not meant a collapse in opportunity, but rather a pivot. Xiao notes steady demand in private banking, wealth management, and roles such as compliance and risk. In a more competitive market, these areas are increasingly seen as viable entry points.

Mehmet Yasir Koca, now the chief financial officer of Istanbul Airport and a former investment banker at Italian lender UniCredit, used his post-experience MiF from London Business School to prepare for corporate leadership.

“Infrastructure and real assets industries are more project finance and financial modelling-oriented, and the MiF programme provides remarkable technical training,” he says.

As graduates pursue roles outside traditional banking tracks, business schools are adapting. MIT Sloan School of Management in the US, for instance, has added advanced coursework in AI, machine learning and data science to prepare students for specialised roles.

Quantitative trading and data-driven positions now account for over 40 per cent of job placements among 2024 Sloan MiF graduates, reflecting growing employer demand for technical talent.

“While some finance employers may be taking a more cautious approach to associate-level hiring, we continue to see sustained demand and interest . . . at the analyst level for investment banking roles,” says Susan Brennan, assistant dean of MIT Sloan’s Career Development Office.

Overall, 98 per cent of Sloan’s job-seeking MiF graduates last year accepted offers within six months.

The top MiF programmes continue to deliver strong financial returns within a relatively short timeframe. According to the latest Financial Times’ 2025 rankings, alumni from pre-experience programmes such as HEC Paris and ESCP Business School report average salaries exceeding $160,000 three years after graduation — far eclipsing tuition fees.

For Ludovica Righi, an analyst at JPMorgan in London and a graduate of HEC’s master in management with a finance focus, a top-tier brand remains a ticket to opportunity.

“We all found jobs without any particular issue . . . many of us ended up in big banks,” she says of her 2024 cohort. “If you go to a top school, it’s much easier.”