The management consulting job outlook for 2021 is something thousands of ambitious new graduates – and experienced industry hands - are looking forward to with anticipation and concern. The consulting job market has been improving steadily year over year for a decade, with each turn of the calendar bringing an expanding job market. This has largely been a result of the success of the management consulting industry as a whole, which by 2019 had grown to $160 billion worldwide. However, the landscape of the consulting job market—like the rest of the economy—has been disrupted and transformed by the Covid-19.
So what does Covid-19 mean for the management consulting job outlook in 2021? Will there be a total hiring freeze? Or will the competition from hiring slowdowns be offset by fewer candidates hitting the job market? In this article we’ll walk through what aspiring management consultants should expect in terms of the 2021 management consultant job outlook, and how they can best respond to it.
What Should Management Consultants Expect in 2021?
So, first thing’s first—the pandemic has triggered a massive slowdown in the global economy, and almost no one is immune. The management consultant job outlook will be diminished by this slowdown. Forecasts have suggested that consulting firms are likely to lose 20-50% of their business in 2020. In turn, the industry itself might shrink from $160 to $130 billion annually.
Management consultants should expect the landscape to look somewhat bleak and slow, for a time. At least, compared to the boom times of the last decade. The Great Recession that began in 2008 offers some indication of what we can expect. Overall, consulting firms are likely to shrink in terms of both new business as well as new recruitment of employees. In-house operations are likely to see significant cuts. This is especially true in terms of low performing or redundant employees. Not to mention ancillary costs, like free snacks and other office perks (which are easier to cut when more people work remotely).
Covid Effect on Management Consulting Outlook
The primary reason for the diminished management consultant job outlook in 2021 is the coronavirus. The covid impact on consulting is symmetrical with the covid impact on the rest of the economy. This is because consulting firms ultimately derive their business from relationships with other industries.
The covid impact on consulting might be limited, to some degree, by whatever optimism and investment potential can be sustained through the (hopefully) temporary disruption the virus is causing. And we do expect the impact to be marginally offset by an increasing need for consulting services on the part of those businesses that remain or form in the wake of the virus.
In times of crisis, the biggest issue businesses experience is a cash flow and liquidity shortage. They also need additional help with:
- Driving digital adoption across functions (ex: sales/marketing, operations)
- Workaround strategy
- Analytics
- Supply chain & procurement
- And more
There is always a need for the services consulting firms provide. Yet, there’s no way to spin the fact that the overall consulting industry will shrink.
Are There Sectors Experiencing Growth?
Even in the midst of an industry-wide contraction, there are sectors inside of management consulting that are experiencing growth. By Q4 2020, we’re seeing incredible demand inside of specific practice areas including healthcare consulting and bankruptcy & turnaround consulting.
On top of sector-specific consultancies like Clearview, Guidehouse (healthcare), Alvarez & Marsal, and AlixPartners (bankruptcy/turnaround) that we expect to grow, the top firms are in no danger of losing their perch in the industry. In fact, McKinsey has already announced that it is not cutting it’s typical hiring numbers. That’s good news for all prospective McKinsey candidates, but especially MBAs, as the firm hires over 1,000 per year across its internship and full-time processes.
Are There Sectors or Firms that are Particularly Hurting?
The jury is still out on where much of the pain will be felt, although there are early signs that Oil & Gas consulting will be hard hit due to the energy dynamics wrought by the pandemic.
In addition, the large publicly traded firms are the likeliest to restrict hiring the most. In Fall 2020, PwC announced that it will not extend any full-time offers to MBAs. The firm typically hires over 100 per year. This is partly due to the fact that the firm extended full-time offers to all of its summer interns, as did Bain & Company, who has also restricted full-time hiring. The jury is still out on firms including EY and KPMG, as they had yet to announce 2020 hiring targets when we went to print.
Will Consulting Recruiting Be More Competitive?
The impact of the coronavirus will make the consulting recruiting outlook more competitive. There will be fewer overall spots for aspiring consultants, which is unlikely to be offset by a reduction in applicants. In addition to interruptions in normal operations and forced budget cuts, the uncertainty is sure to decrease the rate of voluntary attrition and turnover that usually exists at consulting firms.
All of these factors might make it seem like the gates of the consulting world are closed. But firms will continue to hire. They might scale back or delay recruitment relative to other “normal” years. Further, boutique firms are likely to be especially hard hit, as uncertainty will lead other companies to gravitate toward more established & trusted brands. Still, the management consultant job outlook is not hopeless for 2021. It just reflects a bit more pressure on applicants.
What to Do If You Don’t Get an Offer
If the long history of post-industrial economics is any indication, the economy will eventually recover, even from as severe a disruption as Covid-19. Therefore, a more competitive management consultant job outlook in 2021 doesn’t necessarily mean you need to cancel your consulting dreams. However, if you fail to get hired in 2021, you should take steps to improve your competitiveness as an applicant. Going back to school and increasing one’s credentials has long been a strategy young people pursue in times of recession. This allows you to “hide out” from the bleak job market, reentering it at a more opportune time and as a better candidate. If you only have an undergrad degree, consider getting an MBA or some other graduate-level degree.
Another option is to take employment at a less prestigious firm or in another industry from what you first imagined. This can allow you to increase your array of skills and experience. Not to mention, a smaller pond might give you the chance to take on more responsibility than you would be able to as an entry-level hire at a huge firm. This will also increase your competitiveness when you reapply for consulting jobs in the future.
And as a final alternative, you can also consider taking time away to pursue a passion that may not necessarily be academic. This could mean starting your own company, aspiring toward a lifelong creative goal, or even getting meaningfully involved in your community. Any of these things done well can actually make you a more competitive applicant when you reapply for a consulting position.
Conclusion
Every year, thousands of applicants compete to land highly coveted positions with management consulting firms. The education & application process itself has virtually become its own industry. The plain truth is that the management consulting job outlook for 2021 will be more competitive than any we’ve seen for the past decade.
However, instead of letting this strike fear in your heart, we encourage you to rise to the challenge. The fact that you were interested in consulting to begin with means you must be driven by an affinity for challenge and competition. So instead of despairing at the increasing difficulty of the management consultant job outlook, think of it like you are just being asked to play the game on Expert Mode. And if you need a little bit more help getting over the finish line, work with us on resume edits or interview coaching.
Additional Reading:
- Career Change at 40: Breaking Into Consulting as an Experienced Hire
- Starting a Job Virtually
- Companies Hiring Near Me: Recession Proof Jobs Available Now
- The Pyramid Principle