Recently the New York Financial Times published an article showing that there is a significant increase in student applications at Deutsche, UBS, Citi, and other banks. This is an interesting observation since banking has become a less appealing job to students in recent years. Big tech giants like Google and Facebook are attracting more talents from campus, but also start-ups (which frequently speak more to the Millennials desire to make a positive impact on the world) and consultancy firms are being viewed as desirable by the modern student.

Google is, unsurprisingly, a popular place to work. Reports have indicated the company gets about one million resumes every single year. EY, each year, recruits 500 undergraduates and 900 graduates from all degree backgrounds only in the U.K. Nevertheless, the traditional banks’ reports show the increase in the applications and positions for graduates. Deutsche Bank had hired 619 graduates globally last year and expected that the number would increase this year. Morgan Stanley attracted about 100,000 applications for about 1,000 places on its summer analyst program for undergraduates and associates program for MBA students. Morgan Stanley said that the number of the applications are growing by 8% on year to year basis. Barclays International will hire about 500 graduates this year, up from 450 in 2017. Citi drew 60,761 applications for its corporate and investment banking programs globally, up 12% year on year.

So how can the increase in student applications at banks be explained?

The changes started after the Great Recession in 2007 that has caused the collapse of the banking system. The banks lost the trust among the population and time was needed to convince people to trust the banks again. Once the banks failed to deliver the expected stability, they were viewed as a less respectable workplace. The popularity of the traditional banks among the top universities’ graduate was falling. The banks’ bad reputation made them unable to aiming at attracting the top students from Ivy League or Oxbridge pools to become their employees. Manolo Falco, Citi’s head of EMEA corporate and investment banking, said that banks found the solution to the problem but loosening the requirements for the graduate applicants and making the demand wider. The banks started looking for the human resources in a variety of places. This wider spectrum of the banks’ hiring opened the door to the bigger pool of graduates. The trust in the banking system started returning to the banks that channeled the flow of the applicants too.

However, recently, more significant changes have started that influence the decision of the applicants. The mentality at traditional banks has been changing. Instead of trying to attract students with pay, nowadays more attention is being given to the quality of the function (being challenging and exciting). Post-financial collapse, Wall Street firms like Morgan Stanley are attracting college graduates who want more than just a high-paying job. Matt Fitzpatrick joined Morgan Stanley after graduating in the age of 23 because of the emphasis the company has made in the career prospects. Fitzpatrick says “They talked more than any other firm about a culture of giving back to the community, and that is what made me choose the firm over other banks.” The tendency can be observed among other banks: applicants are choosing value they can create over the payment. Jimmy from Hong Kong who is an analyst started working for Deutsche Bank because he “wanted to be working with smart, ambitious people on cutting-edge technologies, and make a positive impact…Deutsche Bank could offer this kind of environment”. Portfolio manager Tessa who is working for Barclays in London emphasizes “I think private banking is different because there is a focus on soft skills.”

The work-life balance, a commonly heard concern amongst Millennials, is also an important factor the employees are looking for. Creating a flexible work environment, prioritizing a healthy culture, and cultivating a happy workplace environment promotes work-life balance. When employees are happy in their roles, work will feel more like a second home, and less like working for a paycheck. Banks have stepped on the path of changing the workplace towards what graduates are looking for but there is a long path remaining to catch up this the environment in the tech giants. This does not mean investment banking has become a less demanding job, but it does show that the changing work ethics are being taken into account.

Another aspect might be the trend that people are getting less skeptical about investing in securities on the market. The economy has been thriving after the crisis and the people have almost regained trust in the economy and banks. In order to achieve good investments, people nowadays prefer to invest in actively or passively managed portfolios rather than keeping their money in the deposit accounts. These portfolios need to be developed, managed and reviewed continuously to get the best results possible. In my view, a position in the investment bank like this is attractive to students, knowing the responsibilities are challenges attached.

The working environment of tech-giants and banks are still very different, but banks seem to start making a come-back in the attraction of the students. Consultancy firms also remain popular. In the end, I guess it comes to personal preferences relating to the working environments and the purpose that you want to fulfill in your job. Would you apply at a bank? Or would you rather work for a tech-giant or a consultancy firm? I would be interested to hear your thoughts.