Since 2013, banks have launched initiatives such as protected Saturdays and fast-track promotions to improve the quality of life of their junior bankers. Are those policies achieving the goal of improved job satisfaction among investment banking analysts and associates? Well, there’s good news, and there’s bad news.
Recruitment firm Options Group conducts an annual survey of more than three thousand analysts and associates at global banks in the U.S. In 2014, only a third of junior bankers were satisfied with their jobs, but the percentage rose the following year and peaked at 78% satisfied compared to just 4% dissatisfied in 2016.
By 2017, scores ticked down to 75% and they decreased slightly again this year, coming in at 72% of respondents saying they’re satisfied compared to 24% who say they are not in 2018.
“It’s very important for financial institutions to give their people work-life balance, and that is a big mantra right now in investment banking,” says Mike Karp, the CEO of Options Group. “Investment-banking processes remain rigorous, but firms are giving analysts and associates more leeway to leave the office a bit earlier and not work as much on weekends.
“Still, a strong work ethic is key, and if you want to succeed, you have to invest your time and sometimes make sacrifices to advance your career,” he says.
The good news is that the 2018 figures are significantly better than 2014, even if a quarter of junior bankers said they’re dissatisfied this year. So, what’s the bad news?
“These numbers look ridiculous to me,” says Anish Patel, a former investment banking analyst at BMO Capital Markets and the founder of Valuation University and Tinto Amorio. “Was the survey sent out right after bonus season?
“All but one junior banker I know wants to get out of banking because they don’t like their jobs,” he says. “I texted the only kid I know who wants to stay in banking longer than three years and asked him, ‘Are you satisfied being in banking?’ and he texted back ‘Hell no – it sucks but it pays well and I’m good at my job, so I’m being practical.’
“These numbers are not at all reflective of reality – 70%-plus satisfied is out of hand.”
An IB analyst currently working at a Canadian bank in New York sang a similar tune, saying the theme among junior bankers is that it’s rough to be on the sell side.
“There is a common thesis across junior investment bankers that this job sucks and that everyone, as in 90%-plus, is aiming to get out,” the analyst says. “If by satisfied you mean the money is good, then yeah, sort of, but holistically I’d venture to say 90% of juniors would disagree that they’re ‘satisfied’ with their job and would stay given the choice.”
When you have demanding clients, you’re on call seven days a week. Mix that with the sell-side model – the more deals senior bankers do, the better for their bonus – the more work you’re going to be doing, the analyst says.
“The juniors are the ones to execute the deals and there’s not much of a difference between being in a group that works 70 versus 100 hours a week bonus-wise for a junior,” the same analyst says. “We’re paid relatively a lot, but considering the hours, not really.”
He adds that most people are simply interested in going to the buy-side or setting themselves p to do something more meaningful. “You can’t say ‘Work less,’ when workloads are dependent on what your clients want,” he says. “You can’t tell an MD to take on fewer deals when that’s how they get paid.”
Baby steps toward improving junior bankers’ job satisfaction
That said, even skeptics say that work-life balance has improved at the larger middle-markets and some of the bulge-brackets over the past five years. The programs they initiated have made things better, but they were a small nudge toward improving overall job satisfaction, Patel says.
“Protected Saturdays and weekends at some firms made lives a whole lot better, as well as the upper-middle-markets and the bulge-brackets promoting people directly from second-year analyst to first-year associate, which made a lot of people more comfortable staying a little longer, but in terms of do they find it satisfying? A big ‘Hell no,’” he says. “I really enjoyed my [IB] job, but I would put neutral if it’s measuring overall satisfaction from one to ten.”
The junior bankers who really like their job and are good at it get crushed the most by a heavy workload, and if you’re on an active deal, then those protected Saturdays go out the window.
“The hours are a little bit less, they got promoted earlier and got more money, but are they satisfied with their jobs? A resounding no,” Patel says.
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