Students who receive an MBA during an economic downturn can on average expect at least a decade of lower earnings, according to a recent study by Graduate School of Business (GSB) Prof. Paul Oyer. But Stanford MBA students say they have yet to feel the crunch as they finalize their post-graduation career prospects.

Oyer’s study measured the effect of the performance of financial markets on the percentage of Stanford MBA students who choose careers in the financial sector.

“When the stock market’s doing well, more of our Stanford MBA graduates go to work on Wall Street than when it’s not doing well, and you can see that very clearly in the data,” Oyer said.

In years where fewer students enter the financial sector after graduation, the average earnings of the graduating class diminish because financial sector jobs generally pay better than jobs in other sectors.

Oyer also found that students’ decision to work in the financial sector as opposed to another field immediately after graduation impacted their careers many years into the future.

“If you look at those groups ten or twenty years later, the ones that graduated in a good time to go work on Wall Street still work there, and the ones that didn’t have not made the switch,” Oyer said.

Since students tended to stay in the same sector for at least a decade, those who graduated in bad economic years — when fewer students chose to work in the financial sector — experienced persistently lower average earnings than their counterparts who graduated when the economy was doing well.

Oyer hastened to add that, although the economy is experiencing a recession this year, Stanford MBA students need not panic about their employment prospects.

“If you have an MBA from Stanford you’re in a pretty good position,” Oyer said.

Celia Harms, senior associate director of Recruiting Services and Marketing at GSB’s Career Management Center (CMC) agreed that Stanford’s MBA students were unusually well-prepared to deal with the fluctuating supply of jobs in terms of economic crisis. The job placements of MBA students graduating from GSB this year have been largely unaffected by the recent economic downturn, Harms said.

“Our students really look very broadly in terms of the positions and industries they look for jobs in,” Harms said. “GSB students have always picked a very diverse range of positions. They’re insulated when one sector is experiencing a downturn.”

Laura Brezin MBA ‘08 said students looking for careers outside of the financial sector had seen little effect from the economic downturn.

“As far as I can tell, it’s mostly confined to specific kinds of jobs, especially hedge funds and investment banks,” Brezin said.

“Things are still pretty good for Silicon Valley,” Brezin added. “Lots of my classmates are interested in either working for a tech company or doing something entrepreneurial.”

According to the CMC, about 38 percent of the GSB class of 2007 opted for jobs in the financial sector. The rest pursue positions in consulting, technology, real estate, health care and other business-related fields.

Harms said that many MBA students are offered jobs following successful summer internships between their first and second year at GSB.

Because of this system, Harms said, many employers focus on recruiting first-year rather than second-year MBA students. This year’s graduating MBA students were largely recruited last year, “before the downturn in the economy really hit hard,” Harms said.

She added that first-year students should not worry about bearing the brunt of the current recession.

Financial firms have “definitely kept the pipeline very robust for first-year recruiting in the winter,” Harms said. “In terms of summer internships we did not see a contraction.”

“We have very, very talented, bright students, and because of their extraordinary backgrounds, they do very well in the job market, in terms of looking for positions,” Harms added. “They’re very gifted students.”

Luke Baxter MBA ‘08 said he was optimistic about his classmates’ job prospects.

“It’s not a bloodbath,” he said.