The drums of economic downturn have been beating loudly. Very loudly during the last few weeks. Almost like daffodils after a spring rain, articles about grads having fewer job opportunities and employers, especially in financial services, cutting college and MBA recruiting have sprouted:

• From The Wall St. Journal: "For Class of '08, A Scramble for Jobs." This article focuses more on this year's college senior.
  
• From BusinessWeek "It's Looking Grim for New Grads." The impact of the credit market melt-down is felt throughout financial services and by all grads interested in careers in business, specifically those interested in financial services.
• From BusinessWeek "Bear Stearns Rescinds Job Offers." Now it's official Bear Stearns is rescinding some offers extended to members of the MBA Class of '08. While it may have been more shocking if none of the offers had been rescinded, the reality is increasing nervousness and tension throughout MBA-dom. The memories of rescinded offers are recent (2002) and painful.
• From the NY Sun "Economic Woes Could Be Felt by MBAs of 2009.", a slightly more optimistic piece. It looks at the market and concludes that 2008 grads "dodged the bullet." The outlook for 2009 MBA grads is much more cloudy. In fact b-schools, like MIT Sloan, are pro-actively turning to their alumni to help with placement for '09 grads.

Implications

If you are graduating in this market, you may need to be flexible and bring out Plan B. IT, government, and health care are still hiring and going strong. Engineering grads are in demand.  Alternatively, this year may be a great time for travel or community service perhaps prior to grad school with the hope of graduating in an up economy.

But what if you are planning to apply to MBA programs this fall? I went out on a limb and gave my predictions for the upcoming MBA application season on April Fools Day, with the observation that time will tell whether that post was an April Fools Day joke or something more meaty. Commenter "It's Happening" points to the BW articles (published April 3) as proof that my predictions are coming true. 

I like to be right, but there is also evidence going in the other direction. For example, MBA Tours reports that attendance at its events in Fall and Winder 07-08 increased 30%. I suspect that much of that increase took place before Bear Stearns collapsed and before the news got as bad as it has been for the last month or two. I also hear that a surge in recently employed investment bankers is taking the GMAT exam.  A year or so ago, I was reading articles about these financial jocks who didn't feel it paid for them to go for their MBA.  Clearly something has changed dramatically.

I still believe that if articles continue to appear about unemployed MBA's, lower average salaries for MBA grads, and more rescinded offers, potential applicants who have jobs will be reluctant to give up the security of a paycheck for the uncertainly of a tuition bills, student loans, and no income.  Fewer applicants could make next year a little less competitive year and an opportune time to apply. Furthermore, the fact that 08 or even 09 could be tough hiring years says nothing about hiring for 2010. Just like last year's recruiting environment implied nothing about this year.