FDR Foundation

WHY ELITE STUDENTS GET ELITE JOBS

The conventional meritocratic recipe for success is simple enough: study hard in school, get good grades, be involved in one’s community, find an appropriate college, apply for jobs in your field of study, and everything else falls in place. But that’s not how it really works says Lauren A. Rivera, author of Pedigree: How Elite Students Get Elite Jobs.

The path to success she sees is this:  Be born to upper-middle-class or wealthy parents. Know what academic tracks to be on by the end of middle school — knowledge that one acquires from well-educated parents and school counselors with low caseloads. Get involved early in the competitive sports favored by elites, such as lacrosse, tennis, sailing, skiing, golf, cycling, climbing, soccer, and running. Test well enough to get into an elite university.

Apply for a first job in an Elite Professional Services Firm (EPS), the “finishing school” for American elites. They include Wall Street, top management consulting, and exclusive law firms. After you’ve demonstrated that you’re “one of us” in the interview get on the EPS launching pad, which eventually leads to a high-status career in corporate America, politics, or the nonprofit world. Eventually, have children with a spouse of a similar class background, raise them in fine neighborhoods with top schools, sent them to elite universities, and the “virtuous” cycle of elite reproduction continues.

The book offers a rare glimpse into the hiring practices of EPS firms and how they differ from “the dominant theory of hiring” in the United States. The dominant model holds that employers hiring decisions are based largely on “estimates of human capital, social capital, gender and race. But that model is inadequate, she argues, because it fails to account for the increasingly powerful role that one’s class background plays in the recruiting and hiring practices firms that prepare one for leadership roles in society.

Rivera, a management professor at Northwestern University, acknowledges these trends with alarm. Her book goes further than most in that she looks beyond elite college admissions to how elite students find high-status jobs. As a direct observer and participant in the hiring process at an unnamed EPS firm, Rivera shows that elite education is a virtual prerequisite for entry into high-status jobs — jobs that according to the commonly viewed ideal of meritocracy should be available to any competitor on the basis of ability and experience. She demonstrates, convincingly, that’s not the case.

Raised working class in Los Angeles by an immigrant single mom while her father was in prison, Rivera says she was able to penetrate this rarified atmosphere due to her own experiences attending elite prep schools, colleges and graduate school.  She describes being “checked out” by the insiders of the firm in which she carried out her case study, who determined that she was “one of us,” before agreeing to be interviewed for her study.

The author says she did not set out to prove any particular theory, but allowed the data to drive her interpretations.  She concludes that the hiring practices of certain employers — ones that are pivotal in shaping the nation’s future leaders — are driven by considerations of class status. Class, she argues — and the social capital associated with class, is more important than virtually any other factor in whether certain high-statues employers will even consider an applicant for a job.

The key word is pedigree: the array of background traits, including the cultural, social, and educational capital passed from one generation to the next, which EPS candidates bring to the competition for elite jobs. But it’s a closed competition.  One must get through the gates first.  A candidate’s pedigree determines whether his or her application to an EPS firm is legitimately considered in the competition, or tossed in a slush pile of candidates who have no realistic chance to even compete for such jobs.

Of course, pedigree has always been influential in hiring decisions for first jobs at elite professional service firms.  While Rivera acknowledges this, she contends that the rules surrounding pedigree have changed over the generations.  Although elite employers have always hired on the basis of pedigree, the mechanism is now far more indirect. Finding young talent to fill society’s most important and highly paid jobs once was based on descent, the handing over of familial economic power from one generation to the next.

Today, elites have modernized the rules of entry. Rather than explicit bloodlines being the determining factor, the outcome biased toward elites is interpreted as just the rational outcome of the “meritocracy” at work.  Now, just as elite colleges contend that they admit students on the basis of cognitive talent, elite employers claim their highly competitive hiring practices lead to finding the best and brightest young employees.

But the way elites choose talent is hardly an open competition, Rivera argues. Rather, EPS hiring is a “sponsored contest.” While any college graduate is free to apply for a position, only those who are pre-qualified are actually permitted to compete.  The most important pre-qualification is earning a degree from one of two types of schools.  Generally, EPS firms maintain two lists of colleges from which they draw the applicant pool.  First is small list of so-called “core” schools that have fed firms’ talent requirements for decades.  The relationships are historic, steadfast, and habitual. Think Ivy League, especially colleges that are within a few hours drive from power centers of finance, banking and law.

Next is a list of “target” schools that firms have relied on for talent, but to a far lesser extent than core schools.  The pivotal difference between a sponsored and an open competition is the behavior of gatekeepers in seeking talent.  EPS firms go to great efforts to seek out the kinds of college graduates that fit the firm’s culture.  The firms go to the students, spending valuable time and money traveling to the listed campuses and recruiting for their applicant pool.

There is one noteworthy exception, Rivera says.  If a highly regarded EPS firm happens to occupy a booth at a “diversity” job fair, that’s likely no more than a show and tell, serving the firms’ needs to convey itself as an equal opportunity employer, which enables them to compete for federal contracts.  An open competition for jobs is far different: in almost no instance does a gatekeeper for an open contest seek out applicants. In this sense, then, a competition for jobs at the post office is far more competitive than hiring the chosen candidates for any EPS firm.

Then comes the sorting of resumes and the interview process.  At these stages, evaluators at EPS firms, often busy staffers and analysts who work with high workloads, are pretty much left to their own preferences without any firm guidelines from lowly valued human resource departments.  A typical evaluator will spend no more than 60 seconds per resume. In that brief moment, the evaluator scans resumes for positive signals of fit with the firm or red flags that suggest a bad fit.  These decisions are often based on personal biases, reflecting the evaluators’ own background.  Rivera calls this “looking glass” merit: evaluators choose candidates like themselves, with similar family backgrounds and cultural habits, down to the sorts of recreational activities and sports they might share in common.

For example, in the off-chance that a candidate at this stage had graduated with high honors at, say, the University of North Carolina, that would be considered a red flag.  “State schools,” as public universities are called in this competition, would be considered a sign of “intellectual failure.”   Candidates who’ve graduated form a core school are presumed to have the cognitive ability to do the job — although no actual evidence of this presumption exists, Rivera says.

One example stands out.  Rivera interviewed a hiring consultant named Natalie, who examined an application from Sarah, a graduate of New York University’s Stern School of Business.  Natalie noted that Stern was a top ten business school, but not a top three school. “She’s there either because her husband is in New York or she applied to business schools and she didn’t get into Harvard or Stanford.”  For Natalie, Sarah’s graduating from NYU’s Stern School of Business was a red flag, indicating some kind of intellectual failure.

Another red flag is whether the candidate happened to participate in the wrong types of sports in school. Evaluators often looked for similarities in recreational activities as a signal for shared interests and comfort level. One evaluator told Rivera he always asked a job candidate what he or she did for “fun.” The answer wasn’t acceptable if the activity were not something that was fun to him.  One candidate told the evaluator that he liked reading the Wall Street Journal for fun. An EPS evaluator told Rivera, “Nobody reads the Wall Street Journal for fun. And if they are unable to come up with something they do for fun, they are done.”

The classed-based hiring practices of EPS firms might not be so unsettling if such firms had not achieved the level of status, economic power, and influence that they currently enjoy in American life, Rivera contends.  Owing to the high pay and high status that EPS firms use to tantalize graduates, significant numbers of elite college graduates have turned to EPS firms for their first jobs out of college, ignoring opportunities at other types of employers such as manufacturing and educational institutions.  At Harvard alone, more than 70 percent “of each senior class typically applies to investment banks or consulting firms,” Rivera says.  In addition to the highly skewed demand for EPS jobs, this “holy trinity,” has become a well-traveled springboard to leadership positions in all aspects the United States.

Rivera cites research that America is unique among other advanced nations in the extent that people care about the reputation and prestige of one’s alma mater. In few other countries has one’s potential for leadership been so closely tied to where one attended college. As Rivera demonstrates, that has become a self-fulfilling prophesy of the new meritocracy. Exceedingly influential firms have uniquely positioned themselves as “finishing schools” for America’s elites, and yet there is virtually no evidence to suggest whether the system selects for the best, or simply the more well-positioned and well-polished.

For the most part, Rivera’s analysis is believable and compelling. We’ve always known such discrimination along class lines exists at elite professional firms, but she may be the first to inspect the detailed mechanisms that perpetuate the practice.  She fails, however, to address other types of superficially open, but actually closed competitions in which insiders are known to have unfair access to certain jobs in the United States.  The practice is not uncommon. These jobs would include children of police officers, firefighters, union tradesman and similar careers.  Remember?  “It’s who you know, not what you know.”

What’s more, one could argue that EPS firms are selecting candidates most equipped — intellectually, socially and behaviorally — to succeed in jobs that require an unusual ability to communicate and be comfortable with high-status clients in the corporate world.  Evaluators would naturally doubt, for example, whether a first generation college or professional school graduate attending a modestly selective university would have the polish to succeed.

Still, the classed-based hiring practices of EPS firms is unsettling, compared to the semi-open competitions for, say, police or union jobs.  EPS firms are unique in that they occupy far greater status, economic power, and influence than many careers. Owing to the high pay and high status that EPS firms use to tantalize graduates, significant numbers of elite college graduates have turned to EPS firms for their first jobs out of college, ignoring opportunities at other types of employers such as manufacturing and educational institutions.  At Harvard alone, more than 70 percent of each senior class typically applies to investment banks or consulting firms, says Rivera, quoting Nicholas Lemann in the New Yorker.

In addition Americans love a competition that’s open to all comers, like the “Open Championship” in Great Britain and the U.S. Open here. The purpose of these tournaments is to identify the best golfer on the planet during a week’s competition, based strictly on performance.   The opportunity is open to any golfer, not just to those from private country clubs. Indeed, a competition rigged to pick the privileged few is abhorrent to our collective sensibilities. Exclusion based on the conceit that graduates of certain American colleges and universities are intellectually deficient is reminiscent of the days when the U.S. Army rated recruits on the basis of IQ tests.  Those tests purportedly demonstrated the intellectual superiority of immigrants from Arian nations over cognitively deficient immigrants like Jews and Italians.

“Because of the way they hire,” Rivera writes, “these employers end up systematically excluding smart, driven, and socially skilled students from less privileged socioeconomic backgrounds from the highest-paying entry-level jobs in the United States, positions that serve as gateways to the country’s economic elite.”

14 thoughts on “WHY ELITE STUDENTS GET ELITE JOBS”

  1. Force the colleges to admit students by random drawing. Allow them to set minimum objective standards on the basis of the lowest sores who graduated in 4 years. Put all of the names in a hat and pick out the lucky winners.

  2. This exercise in hand-wringing strikes me as much ado about nothing. A great many people succeed in America without going to an elite university or getting one of those supposedly elite jobs. Moreover, many of the people who do get degrees at elite universities don’t find them to be the keys to the promised land. Lots of incoming grads at those top firms wash out. Finally, the real elite — where power is located — is the political elite, and that is wide open to anyone. Sadly, the wealthy often succeed in using politics to help them stay wealthy by placing obstacles in the way of those who want to compete. That’s the problem that needs to be addressed.

    1. Of course there are exceptions to the rule, but the exceptions that you point out don’t undermine the idea that going to certain schools and being from a relatively higher socio-economic background conveys an enormous advantage over middle-class students when it comes to landing the best jobs.

      And your last two sentences basically confirm the findings reported here. One way that the wealthy use their wealth to buy advantage is by filtering economic opportunity according to who went to the “right” schools or played the “right” sports or has the “right” hobbies. Those schools, sports, and hobbies are usually quite expensive. That’s all part of the filtering process that tends to include the children of the wealthy and exclude the children of the middle class. It’s one reason that social mobility in America is not as high as some other developed countries and has gotten worse in the past few decades. The US is becoming a rigid, class-based society. Focusing on contrary success stories won’t change the overall picture.

  3. There is good information here, but this essay has some holes in it. The testing to get into those elite schools is a real measure of cognitive ability , perhaps the best one, not some vague indicator. And no one has thought Jews inferior at them for a hundred years, and that only briefly when they were new immigrants. (Southern Italians actually do average few points lower). Military testing does still track IQ with high correlation. Because it, uh, works.

    Not all people with high intelligence want the jobs you reference here. They go to MIT, Caltech, etc. and don’t give a fig about them. So there is also selection bias in who is pursuing this track. You also rightly note that there may actually be some benefit from being “one of us” in those jobs, that other applicants are less likely to have.

    That said, it is alarming that the obstacles to joining this group are so many, and allow so little new blood to pass through.

  4. Remember? “It’s who you know, not what you know.”

    It’s called ‘networking’, and it happens in every field. It’s the only reason to attend an Ivy League school, let’s face it- the education isn’t any better (and in some cases worse) than any other college in the US. But it provides access to an influential alumni network and opens a lot of doors.

  5. And who has set the best example by running against the grain and making elite jobs open to “all comers?” Not a Democrat or a liberal, but the much maligned Clarence Thomas. In 2008, for example, he hired clerks from George Mason, Rutgers, George Washington, and Creighton law schools. His approach: “I don’t eliminate the Ivies in hiring, but I intentionally prefer kids from regular backgrounds and regular students.”

  6. The United States ” is unique among other advanced nations in the extent that people care about the reputation and prestige of one’s alma mater”. Are you kidding me? All the top ranks in France attended the École normale supérieure. In the UK election, the Tory, Labour, and Liberal party leaders, and virtually all their Cabinet/Shadow top dogs, went to Oxford or Cambridge. Agreed, we’re seeing a dangerous sorting-out by pedigree here in the United States, but don’t insult my intelligence by claiming we’re anywhere near as bad as a lot of really stratified places.

    1. You’re correct; in Japan there’s Todai (Tokyo University), and Kodai (Kyoto University), and then every other school.

  7. Nothing new here, the elites have been felating each other for ages based solely on which school they went to or at least an elite school of some ilk. Seen too may of these things over the years, can’t do the job? Buddy up with your old college chum…

    Competence generally be damned.

    And folks wonder how we got were we are.

  8. This mostly rings true, but the review did not say whether the book addressed the startling change in the demographics of elite universities and EPS firms in the last 20 years. Both have seen a tremendous surge in first generation Asian students. (I meet with investment banking teams several times a month, and it is rare that there is not at least one, and sometimes several, Asians among them.) In my day, there were far more Jews and far fewer WASPs than only a generation before, both at Ivy League universities and in EPS firms. This suggests that the phenomenon described is not as self-perpetuating as implied in the review.

  9. Thank God there is competition!

    Firms and institutions pursuing such low-cost hiring strategies – statistical discrimination, really – will suffer in the market place, unless there is something supporting a cartel, or limited entry.

    I wouldn’t worry much about all this too much.

  10. The COLA increases lead to a $5 billion increase in the unfunded liability. Without going into your financial reasoning — it leaves out a great deal — they are indeed looking ahead decades, as you say. But insisting that the unfunded liability be covered as quickly as possible. Hence they will end up jacking up PERS employer contributions something like 5% in the next biennium. Not a total disaster — only about 5% of the general fund budget, near as I can tell — but still, will cause significant distress to public services.

    The way out of it, in my opinion, is to find efficiencies in public operations — see the back and forth below about school administration — but I believe you are right, PERS often applies rigid actuarial principles in a way that is making a minor problem into a big deal. I don’t think PERS is doing this to cause trouble, I think they are just behaving like good accountants and not incidentally going into CYA mode. It is up to the politicians, heaven help us, to come up with solutions.

  11. I went to a state school and then a private, third-tier toilet law school, both on partial scholarships. The cumulative effect was that it utterly ruined my life. My law degree is worthless – practiced law for 3 years, never earned $35,000 a year. I was laid off in a downsizing, and was unemployed for a year and a half. I finally got work through a temp agency – factory work, $11/hr, high school diploma required. Seven years of higher education, and I was relegated to unskilled labor.

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