This week, I'm going to be on a panel for an event at the USC Business School. And, I'm sure the big question will be: what's the job outlook for venture capital and private equity?

Unfortunately, my response won't be too optimistic. M&A is soft and the IPO market is soft. Moreover, if things continue, it's a good bet we'll see fewer venture capital deals.

All in all, it means fewer job opportunities for MBAs.

In fact, with the meltdown of Bears Stearns Cos. (NYSE: BSC), the firm is actually nixing some job offers for MBAs (which is a pretty rare thing). Although, they will still get their signing bonuses and relocation fees.

Interestingly enough, according to a recent piece in BusinessWeek, it looks like that MBAs that enter the workforce during tough times wind up having diminished compensation over their careers. In fact, it could mean millions of dollars.

The solution? Funny enough, it may mean staying in school until good times return.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates DealProfiles.com.

The big chill for MBAs originally appeared on BloggingStocks on Mon, 07 Apr 2008 12:22:00 EST. Please see our terms for use of feeds.

The New York Times [registration required] reports that increasing numbers of college graduates working in finance -- particularly hedge funds, private equity firms, and investment banks -- are foregoing their MBAs.

This makes a significant amount of economic sense to me -- as long as their employers keep making enormous sums of money. At funds that manage $1 billion to $3 billion, people with just a few years of finance experience make $337,000 -- and those with five to nine years of experience average $830,000. So an MBA for a person with a few years experience would cost $774,000 -- the loss of two years' income plus the $50,000 a year in MBA tuition and living expenses. And that doesn't take into account how much more money that person could have made by staying put.

If an individual wants to manage an organization, an MBA can help them get the skills they need. But to manage money, on-the-job finance skills put the most successful college graduates on a path to massive wealth. If the hedge fund industry goes bust in a year or two, many of those hedge fund babies will probably have enough money that they won't ever need to work again.

If the industry goes bust, those who got MBAs in 2007 so they could get into private equity and hedge funds will probably be the ones who need their degrees the most.

Peter Cohan is president of Peter S. Cohan & Associates, a management consulting and venture capital firm. He also teaches management at Babson College and edits The Cohan Letter.

Hedge fund babies bailing on business school originally appeared on BloggingStocks on Sun, 16 Sep 2007 13:28:00 EST. Please see our terms for use of feeds.