80,000 Hours: Before committing to management consulting, consider [other options]

By Aaron Gertler 🔸 @ 2019-11-12T01:22 (+14)

This is a linkpost to https://80000hours.org/articles/alternatives-to-consulting/

Many people we advise seem to think that management consulting is the best way to establish their career and gain career capital in their first one or two jobs after their undergraduate degree.

Because of this, people we advise often don’t spend much time generating additional options once they’ve received a management consulting offer, or considering alternatives before they apply to consulting in the first place. However, we think that for people who share our ‘longtermist’ view of global priorities, there are often even better options for career capital.

We’ve even met people who already have PhDs from top programmes in relevant areas but who think they need to do consulting to gain even more career capital, which we think is rarely the best option.

This is even more true of other prestigious generalist corporate jobs, such as investment banking, corporate law, professional services, and also perhaps to options like Teach for America (if you don’t intend to go into education) and MBAs. We provide a little more detail on these alternatives below.

We think this mistaken impression is in part due to our old career guide, which featured consulting and other prestigious corporate jobs prominently in our article on career capital. (We explain how our views have changed over time and the mistakes we made presenting them in the appendix.)

We want to clarify that while we think consulting is a good option for career capital early in your career (especially for practical “do-er” types), if you’re able to get an offer at a top consulting firm, you can probably find an even better option if you carry out a wider job search (say, 65%+ chance). Carrying out a job search in this more uncharted territory is harder than staying on a standardised path like consulting, though we think it’s most likely worth it if you have the time.

It’s possible to find even better options because the purpose of career capital is to open up higher-impact options in the future, but consulting rarely seems like the ideal entry route into any of our priority paths. This is because the highest-impact long-term options usually require specialised knowledge and skills relevant to our top problem areas, and consulting doesn’t give you these.

In particular, we think someone able to get a job in consulting can likely get one of the following options, which often seem better:

(Note the following are not in order, and we’re aiming to roughly hold the degree of fit constant. Also note that the average job in most of the above categories would usually not be better than an offer from one of the top 3 consulting firms. But if you have that consulting offer, you probably have a shot at some of the most promising entry-level roles in other areas.)

• Work as a research assistant at a top think tank, aiming to specialise in a relevant area of policy, such as technology policy or security, especially if you’d be working under a good mentor.
• Take other entry routes into policy careers, such as certain Congressional staffer positions, joining a congressional campaign, and working directly in certain executive branch positions.
• Go to graduate school in a subject which has a good balance of personal fit, relevance, and backup options, with the aim of working in policy or doing relevant research. We’d especially highlight graduate study in economics and machine learning, since they provide good career capital and have great backup options, but some other useful subjects include: security studies, international relations, public policy, relevant subfields in biology, and more.
• Work at a top AI lab, including in certain non-technical roles. This potentially gives you similar career capital benefits to consulting, but with more relevance to AI. Certain jobs in ‘big tech’ can also be more attractive than consulting, especially if you can work in a relevant area or skillset, such as AI or information security.
• Join a particularly promising startup, especially in the for-profit tech sector, though small and rapidly growing organisations in any sector are worth considering. Look for any organisation with impressive people, and ideally in a role that lets you develop concrete skills that are needed (e.g. especially management, operations, entrepreneurial skills, general productivity, generalist research), and in a relevant area, such as AI or bioengineering. These roles potentially give you more relevant skills and connections, and also give you the opportunity to advance quickly. If you can build a network in the area, then you can also try to identify an organisation that’s unusually credible (e.g. backed by a range of impressive funders), and might be on a breakout trajectory, which gives you the chance of further upside (e.g. reputation, money).
• Do something that lets you learn about China, such as the steps listed here.
• Work at a top non-profit or research institute in a top problem area, such as Open Phil, CSET, GPI, or GiveWell.
• Take any option where you might be able to have unusually impressive achievements. For instance, we came across someone who might have either had a significant chance of landing a national-level TV show in India as a magician…or doing consulting. It seemed to us that the magician path is more exciting, since the skills and connections within media would be more unusual and valuable to pressing problems than another consultant.
• If you might be able to do something with significant positive impact in the next five years (such as founding a new non-profit), that can often be better because it’s not only impressive, but it also gives you connections and skills that are highly relevant to social impact.

In the appendix below, we make a side-by-side comparison of top non-profit jobs with consulting to show how the non-profit jobs can provide similar or better career capital. We hope to further explain why the above options seem good for career capital in a future article.

Many of these options also give you a better chance of making a positive impact right away (rather than only gaining career capital), though most people don’t have much impact in their first job compared to their long-term potential, so this is usually a small consideration.

Some potential counterarguments

The chief advantage of consulting is that the career capital is highly transferable. However, most of the options listed above will also give you good backup options if they don’t work out and a certain amount of general prestige (e.g. if you do economics graduate study, you’ll have lots of backup options; or if you work in policy, you can change which problem area you focus on).

Moreover, consulting most effectively keeps open options in the corporate sector, which (with some exceptions in particularly relevant industries) tend to be less useful unless you’re planning to earn to give, or need to keep high-earning options open for personal reasons.

Besides gaining career capital, another priority early career is to explore promising long-term options, to find out where you have the best fit. Consulting lets you try working in several industries, which gives you some information about what fits you. However, if you don’t plan to do consulting long-term, then you don’t get to test out a potential long-term option directly. In contrast, most of the options we list above let you test out areas and paths that might be worth working towards long-term. (The 60-hour weeks in consulting also make it hard to research other options on the side.)

On the other hand, even if consulting usually doesn’t let you try out one of the options you’d consider sticking with in the long term, it does let you try out your fit on a range of skills, some of which can be relevant to those paths.

Who should do management consulting?

• If you don’t think you’d be a good fit for any of the options we list above, then consulting might be your best option for career capital.
• Even if you don’t think consulting is your best option, if you’re still at college, it may well be worth doing an internship anyway. At the very least, having a consulting internship is a good credential you can use to land other jobs before you graduate.
• Likewise, it could be worth applying if you think you have a reasonable chance of landing an offer. Job applications are unpredictable, so ideally you should apply to as many jobs as possible. For the types of people who might get consulting jobs, perhaps consulting is their best option 10% of the time, and you might be in that 10% scenario.
• The career capital you get from consulting is most useful if you’re planning to work in operations management or government longer term in a practical ‘do-er’ style role. There are more direct routes into these paths (operations at a good tech startup or entering policy jobs directly), but if you don’t find a good option within the alternative categories (e.g. would hate working in government), or value flexibility especially highly, then consulting could be your top option. In contrast, if you’re more of a ‘researcher’ type, then it’s less attractive. Likewise, you probably shouldn’t pursue consulting if you already have impressive and relevant career capital, such as a PhD from a top programme in a relevant area. This is because you’ll already have some of the benefits of consulting, and you’ll likely have even better alternative options (e.g. think tank researcher).
• As a corollary, consulting seems more attractive in Europe, since the tech sector isn’t as well developed, so there are fewer good startup jobs. Likewise, policy positions in European governments have less influence on emerging technologies than in the US, so these alternatives are also a little less attractive.
• Consulting is more attractive if you want to keep open the option of earning to give, or have high-earning backup options for personal reasons.
• As always, personal fit is a big consideration. If it seems like you’re an unusually good fit for consulting — e.g. you could be a “star” in your cohort, and advance unusually quickly to partner — then it’s much more attractive (though this might also be evidence you could advance rapidly in other paths). Likewise, an offer from the Big 3 strategy consulting firms is significantly more attractive than a typical consulting firm.
• Consulting seems more attractive if you want to work on global health, and people in this area often recommend consulting as a good early career step. We think this is because having an unusual specialised knowledge (e.g. knowledge of the alignment problem) and connections is less important in global health. Consulting is also likely better if you want to work on ending factory farming, since it could help you enter the meat alternatives industry (e.g. Bruce Friedrich mentioned it positively on our podcast). Both of these areas are also more funding constrained, which makes earning to give, and therefore consulting, more attractive. This article is mainly aimed at people focused on our top priority problems, rather than global health and factory farming.

An issue with timing job applications

Unfortunately, consultancy offers are given very early in the academic year (e.g. around September), while other jobs and graduate school usually decide Dec-Feb. This can create an awkward timing issue, since you may need to decide on your consulting offer before you know about your other options. What to do about this depends on your situation, but it’s worth bearing in mind if you intend to apply to several different areas. One way to mitigate this issue is to start pursuing alternatives to consulting before your final year, so that you can do cheap tests and determine if there’s something better than consulting earlier during undergraduate (e.g. do an internship in a policy position).

What about other prestigious generalist jobs, such as investment banking, corporate law, and professional services?

• We focused on management consulting in this profile, especially strategy consulting at the big 3, because these seem like the most promising options for career capital in this general area. We think most of the arguments we make apply even more strongly to other generalist prestigious corporate jobs, which people often take to establish their career early on, such as those listed above. This is because the skills and network you gain are more narrow.
• We think these arguments probably also apply to options like Teach for America, if you don’t intend to work in education, and MBAs (which provide a similar kind of career capital as consulting, but cost a lot of money).
• Jobs in good hedge funds seem similar, but the earning potential is significantly higher, so they’re more attractive if you want to earn to give.
• We’re more keen on tech startups (as listed above) and sometimes also jobs in ‘big tech’, especially if in a relevant role or area (e.g. working at Google Brain).

If you’re already in consulting, what should you do?

• If you’ve been there for 2-3 years, then you probably have some great career capital, and should consider trying out something that’s on a more direct route to having an impact, such as policy jobs or operations management at impactful organisations. Which next step is best will depend greatly on your specific skills, and you can use our decision process to evaluate specific alternatives.
• If you’re doing exceptionally well in consulting (e.g. top 10% of cohort), or need to accumulate more runway, then consider staying longer.
• Ideally, within consulting, aim to tilt towards more relevant areas, such as anything involving AI or policy.

Appendix: A side-by-side comparison of career capital

In this appendix, we make a side-by-side comparison of the career capital you gain from strategy consulting compared to working at a good non-profit in a top problem area.

We chose strategy consulting because it seems like the best prestigious generalist corporate job for career capital. We chose non-profit jobs because they’re often thought of as the worst options for career capital among early steps in our priority paths (e.g. compared to working at an AI lab or going to graduate school).

We argue that the career capital from consulting is not obviously better than working at the non-profit (even before accounting for the direct impact you’ll have at the non-profit).

This implies that there are many next steps directly within our priority paths that provide better career capital than prestigious corporate jobs. So, if it’s possible, we favour trying to enter a priority path more directly.

Below, we’ll compare these options on each key aspect of career capital.

Connections

When recruiting, top consulting firms often tout the value of the connections you’ll make with your colleagues and their high-quality alumni networks. It’s true that the top consulting firms hire impressive people and that they have extensive networks of alumni who have exited into many different industries. However, in consulting, you’ll in large part build connections with other consultants as well as people working in whatever corporate sector your projects happen to be in, such as finance or manufacturing.

There is a benefit to building a network with people who aren’t already involved in doing good, because you might find new people who later become involved.

However, it’s also very important to meet people who (i) have expertise relevant to top global problems and/or (ii) care about the same causes and might be potential collaborators in the future (iii) might mentor you in these areas (which can be especially important in areas where it’s possible to accidentally set back your field. For these other types of connections, it seems better to work directly in a relevant problem area because then many more of the colleagues and organisations you work with will be relevant. Overall, the network you should expect to build in consulting doesn’t clearly seem like an advantage.

Knowledge

In consulting and other corporate jobs, you will probably spend a large fraction of your time learning about large corporations in arbitrarily chosen industries. For instance, people we know who have worked in consulting have learned about things like IT systems at Japanese banks, mergers and acquisitions law, and sewage companies. If you want to have an impact, it’s more useful to gain expertise relevant to top global problems, such as biotechnology, international relations, AI policy or effective altruism itself. While it’s possible to learn about these topics from some prestigious corporate jobs, it’s not typical.

However, it is true that if you gain expertise in another area, then enter one of our priority problems later, you’ll then bring some knowledge to the table that others around you probably won’t have.

Skills

In our recent talent survey, respondents mentioned generalist research, management, operations, and entrepreneurship as among the most in-demand skills. The following were mentioned less often, but still seen as important by some organisations, and are clearly relevant: executive assistant; marketing & outreach; and web development & software engineering.

Consulting helps you improve some general transferable skills, such as communication, problem solving, certain research skills, and general professionalism. It also lets you see and compare practices in a variety of industries, giving more context on what works in different situations.

Some of these are in-demand in our top problem areas, so overall we rate consulting as a good option for gaining skills, however the skills you learn are not as useful as often supposed.

You might think you will learn management by working in management consulting, but in consulting it’s rare to manage anyone for some years. In contrast, if you work at a non-profit it’s not uncommon to manage people much sooner. For instance, it’s common for junior staff to at least manage volunteers or freelancers. We think management is largely a skill you learn by doing, so this is potentially a faster route to management skills.

The other key thing that’s helpful in learning management is to have good mentorship. This is an argument against working at any non-profit where the staff has poor management skills and an argument in favor of consultancies, which have much larger budgets for formal training and mentorship programmes and have been honing them for some time. However, if you can find a skilled team in the non-profit sector, you may be able to get good mentorship in addition to hands-on experience, which is even better.

You might also think that by working in consulting you’ll learn operations skills. This is somewhat true, but you face another problem: you learn the skills in the wrong context. Most analysts at top consulting firms learn about how to optimise the systems of large organisations, whereas the operations skills that are most needed in our priority areas usually involve setting up and running key systems at small organisations. Most of our recommended organisations are non-profits with under 50 employees, or academic research institutes, where the context is quite different — 100 slide powerpoints and management speak are not popular. Consulting is most relevant for entering government, but unless you’re specifically focused on public policy consulting, even there, the context is pretty different.

Financial runway

Prestigious corporate jobs are among the highest-paid options, so they are good for saving money. However, because you’re around peers who earn and spend a lot, people often say they didn’t save as much as they hoped to in the first couple of years.

Credentials

Consulting is prestigious — many of the companies have globally recognised brands, and these jobs also let you consult for or advise other prestigious firms. These jobs are also widely known to be highly competitive, so having the job allows you to signal general competence.

However, our impression is that within the problem areas we focus on, this is not the most valued type of credential. A stint at McKinsey is impressive and it’s definitely seen as a good signal of intelligence, general competence, and conscientiousness. However, if you’re able to get a job at a top consulting firm, you’re probably already able to demonstrate these qualities to potential employers (e.g. through your academic record or other options).

People in our priority areas are often more impressed by evidence that you have skills, connections, knowledge and motivation that are highly relevant to the issues, such as AI or policy. You can often gain this evidence most effectively by working for organisations focused on the relevant issues.

For instance, if you eventually want to work on AI policy, a year at Oxford University’s Center for the Governance of AI might be a better signal to future employers than a year in the corporate sector. Indeed, working in corporate jobs can even be taken as a slightly negative signal in a couple of top paths, such as academia.

Personal fit

Perhaps the most valuable type of credential is impressive achievements, since this is what makes you most stand out and gain the best connections. Impressive achievements are most likely in areas where you have excellent personal fit.

This factor could push in favour of prestigious corporate jobs if you’re a good fit for them, but it could also push in favour of a non-profit. Indeed, many in our audience will likely find it more motivating to work directly on important issues, and so have more personal fit in them.

Our impression is also that if you work in neglected areas like those we highlight, it’s easier to have really impressive achievements than if you follow a standard path that’s highly competitive and structured, like consulting. (Though the non-profit is more risky, in that you’re not at least guaranteed the credential of a corporate brand if you don’t end up achieving much.)

Working in a prestigious corporate job might also raise your risk of giving up on social impact altogether, while surrounding yourself with colleagues who care deeply about impact is perhaps the best defence against that.

Sum up

Consulting only seems to clearly win on financial runway. For the other factors, it’s either unclear which wins, or the non-profit position looks better.

In this section, we focused on comparing consulting to non-profits because they’re often considered the worst bet for career capital. These arguments potentially apply even more strongly to jobs at other high-quality impact-focused organisations, such as for-profits, government agencies and research groups.

Likewise, consulting also seems like the best option for career capital among generalist prestigious corporate jobs, so these arguments will apply more strongly to options like investment banking, corporate law and professional services.

The track record

The above analysis seems supported when we look at examples of people we’ve advised. Over the last seven years, we’ve seen a number of people go into prestigious corporate jobs and then return to directly impactful projects. In most of these cases, if we compare them to people who focused on impact the whole time, it doesn’t seem like they gained skills that are obviously more useful, or were accelerated into positions ahead of where they would have been otherwise.

Meanwhile, some of the people who focused on impact had impressive achievements, such as raising millions of dollars for charity, founding new fields, or attending Y Combinator. They’ve also gained highly relevant connections and skills.

To be clear, it’s also not obvious that those who pursued prestigious corporate jobs are worse off than they would have been if they’d worked directly on pressing problems instead. Our claim is that it’s not clear they’re better off either. This means it’s not clear they gained a large boost in career capital by taking the corporate job.

We’re not saying it was a mistake for people to take corporate jobs at the time. One factor is that there were fewer alternatives available seven years ago, so many people had to work elsewhere. We’ve been very excited to see many of these people come back and take-up high-impact roles, and we see many of these examples as success stories. Career choices are also complex, and there may have been other personal factors at play.

Example: Lewis Bollard

Lewis Bollard is a program officer at the Open Philanthropy Project who previously worked as a consultant at Bain & Company. When we asked him whether he would recommend working there to others interested in social impact and whether it taught him many skills, he said (lightly edited for clarity):

For myself I don’t think it did. I can certainly see it making a lot of sense to someone, particularly if they are looking to give money — consulting can be a useful launching point for a lucrative career. I think that if you are looking to work in management with a non-profit, you can learn some really useful skills. Analytical skills are certainly brought to bear.

For myself, my feeling is that, I mainly did consulting as a sort of a cop out because I wasn’t yet ready to go and work full-time on animal advocacy, and because I came into the job market during the depression, and so it was kind of exciting just to have a job in New York. I ended up working there for a year. I don’t really believe that in that time I gained a lot of useful skills. I think I mainly gained a lot of information about very particular business sectors, which would be useful if I wanted to go and work in those business sectors. Otherwise, I’m not sure it is completely generalisable.

Example: Ben (the author)

If I hadn’t worked at 80,000 Hours, I would have likely worked in investing instead — a typical prestigious corporate option. However, I think I gained better career capital from working at 80,000 Hours. This is because the job let me meet other talented people who care deeply about social impact, who I expect to work with in the future. I’ve also gained more interesting achievements and think I’ve learned a lot about running a social impact organisation, which seems more likely to be useful.

Appendix: How we made a mistake promoting prestigious corporate jobs and how our views have changed

For the reasons in this article, we intend to de-emphasise prestigious corporate jobs in our online advice from now onwards. In our 2017 annual review, we said that promoting them too much is likely one of our mistakes.

We likely erred by highlighting the memorable idea that working in consulting could be higher impact than working in a non-profit. We didn’t appreciate how hard it would be to shift this perception, or how the message would become overly simplified. We tried to clarify our views as early as 2015 (here, here, and here) but still discover engaged readers in our one-on-one coaching who seem to overvalue prestigious corporate jobs.

In the original career guide, we said that prestigious corporate jobs are often better for career capital than typical non-profit jobs. We still believe this. But, if you have the opportunity, it can be even better to join a top organisation that’s working directly on one of the most pressing problems (whether or not that organisation is a non-profit) or get other career capital that’s more relevant.

Our views have also further evolved since 2015, in a way that has made us overall less keen on consulting:

1. Our priority paths shifted more towards policy and research positions in niche areas, and corporate jobs are not the very best entry-route into these kinds of roles.
2. We’ve come to further deprioritise earning to give, due to the reasons here.
3. We think the flexibility corporate jobs offer is less valuable than before, because (i) we’ve become more confident in our top problem areas, (ii) we realised that other options also give good backup options, (iii) keeping open earning to give seems less useful, and (iv) we’ve realised that when working with a community specialisation is more useful.
4. We saw more careers play out over time, showing that corporate jobs didn’t accelerate people’s careers as much as we thought.
5. We’ve realised the paths with the highest-value of information to try out are those that are potentially highest-impact in the long-term, which isn’t consulting for most people we advise.

One issue we’ve been unsure about is how urgent it is to try to make a difference compared to gaining career capital. Several years ago, we were more focused on urgency, which also made us less keen on consulting, though more recently we’ve become more unsure.

We made a further mistake by updating the career capital article in our career guide too slowly, since we were aware of many of these points in 2017. We’ve now added a note to the top of the article, and de-emphasised the career guide on the site. Our current views are in the summary of the key ideas series.