Goldman Sachs Group Update
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Goldman Sachs becomes the last large investment bank to raise salaries for junior employees Complaints about burnout From new employees caught in a trading boom during the pandemic.
According to people familiar with the matter, the basic salary of analysts in the first year is now $110,000 and will increase to $125,000 in the second year. Those at the higher level of assistants will receive a reward of $150,000.
The increase means that Goldman Sachs will have one of the most generous starting salary programs in the industry. These figures do not include year-end bonuses, which may be a multiple of salary in a booming year.
Goldman Sachs declined to comment.
Have a Fierce internal debate About the salary of Goldman Sachs. According to a report by the Financial Times last month, some executives believe that raising junior wages is fixed and cannot be easily lowered. It may create a “dangerous precedent” and attract “mercenaries.”
But the bank is pressured by competitors and fears that its most promising junior employees may be acquired by private equity or technology groups, which offer comparable salaries and often have a better work-life balance.
Morgan Stanley Notify its new analyst Last week, they will earn $100,000 per year, while the income of the second-year analyst is $105,000—more than $85,000 and $90,000, respectively.
Prior to this, the annual salary of JP Morgan Chase, Barclays, Citigroup, Bank of America and other companies ranged from $15,000 to $25,000, and these companies now also pay about $100,000 to new recruits.
Credit Suisse and Jefferies also provide benefits for young employees, such as a one-time “lifestyle” bonus and free Peloton exercise bikes.
After a group of first-year employees, the problem of job burnout among young employees became particularly sensitive at Goldman Sachs speak out Regarding the impact of hard working hours on their mental health.
In a widely shared speech, they claimed to work 95 hours a week and sleep for 5 hours starting at 3 a.m. every night. In response, Goldman Sachs promised to hire more employees to spread the workload and ensure that junior employees have some weekend holidays unless they are actively engaged in transactions.
Goldman Sachs chief executive David Solomon (David Solomon) took a strong stance on flexible arrangements when the office reopened. He called working from home “a deviation that we will correct as soon as possible.”
Morgan Stanley CEO James Gorman was equally stern, telling employees: “If you can walk into a restaurant in New York City, you can walk into the office.”
In contrast, other banks such as Citigroup and UBS have touted their use of mixed practices as a Recruitment advantage.
During the boom in pandemic-driven transaction activity, investment banks benefited from M&A advisory, and salaries across the industry are rising.
Since the beginning of 2020, more than 500 special purpose acquisition companies have been established to raise cash on the stock market and then look for companies to go public, resulting in a significant increase in working hours.
Investment banks have historically avoided large inflation of fixed wages, and it is more difficult to reduce them during calmer periods. On the contrary, they tend to award bonuses to employees every year based on the overall performance of the individual and the bank.
According to Wall Street Oasis, a website that tracks compensation, analysts and partners at Goldman Sachs typically earned less than their peers in the first year.
The average salary of analysts at the bank in the first year was about $86,000, plus a bonus of $37,500, which lags behind Wall Street’s average of $91,400 and $39,700, respectively.