
Why Goldman Sachs wants junior bankers to take weekends off - codegeek
http://www.cnbc.com/id/101152612
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mathattack
_For the most part, the jobs in tech are just better jobs. The senior people
you work for are less likely to treat you as if you are "useless" and only
worth what you're paid because you are "available at all hours."

The work is more psychologically rewarding and has less social stigma attached
to it. You don't have to wear a tie. And there is the perception among young
people that the potential financial upside is larger in tech than in banking
(this is not entirely accurate but that's beside the point). Goldman's move to
free up the weekends of investment banking analysts is no doubt driven by an
understanding that the market has changed. Finance no longer has a monopoly on
smart kids looking to make a lot of money. It has to compete to win them away
from tech._

This is exactly it. Investment banking barely pays more than tech for
analysts. Banking IT pays engineers less than Google or Twitter. Add in the
social prestige, quality of life, and respect from management, and it's
understandable why they are having a harder time hiring the best.

Goldman has a choice: Pay a lot more, Accept less worthy talent, or treat them
better. They chose #3.

~~~
zallarak
Entry-level engineers in NY or CA with a relevant degree make more than entry-
level investment bankers on Wall Street..

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mathattack
I'm not sure I agree, but if I'm wrong, it even further explains why GS is
doing what they do.

My impression is that the analysts can make 100K in year 1, and 200+K by year
3 or 4, but no equity. I would think that folks at Google making 200K after 3
or 4 years are outliers. Please correct me if I'm wrong, as I'm a little out
of touch for what large tech firms pay.

~~~
zallarak
Nah, analysts will make 100Kish for up to 3 years, where they can then be
promoted to associate which is 150-200K, maybe more if they are great or the
firm has a great year. Some firms offer up to 150K for entry-levels but half
that comp is an end-of-year bonus which sucks because its at the end of the
year (lock-in) and it gets taxed at a higher rate.

Engineers at the big tech firms pull in 100K+ (this plus literally means up to
200K.. more for some real talent) with solid signing bonuses as a starting
salary. No end-of-year lock-in bs either.

~~~
mathattack
More on folks leaving Wall Street here....

[http://www.cnbc.com/id/101156782](http://www.cnbc.com/id/101156782)

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jsun
Problem potentially even more dire than article makes it

"These jobs pay very well. According to the job search site Indeed.com, the
average salary for an entry level software engineer in New York City is
$71,000—just about the average for an entry level investment banker."

is a very misleading statistic. At a good school maybe the top 5% of a
graduating finance class gets banking jobs. Pretty much every single CE or CS
major gets a job in technology if they want one. The top 5% goes to work for a
top tech firm who routinely pay 1st years 100-120k+, with amazing perks, work
life balance, and tremendous growth potential.

~~~
chrisgd
The salary is just base. Bonus is probably 100-250% of base, and a lot of
times the 100% part is guaranteed. Just for comparison sake.

~~~
rayiner
Not for junior analysts, and not in this economy. Average base + bonus seems
to be just over $100k for junior IB analysts at GS/MS/JPM this year, pushing
to just over $200k after a few years. After that, the banker starts to pull
away rapidly, and can earn the 100%+ bonuses. But on the flip side, you can
probably still expect to have a job at Google in a few years, but the standard
for investment banks is a 2 year contract after which only the best analysts
are retained.

~~~
ajiang
Nope. 120-130K all in for top bucket in 2013, with some firms paying 140-160K
(see BAML and Moelis).

Also not true is the 2 year contract, as GS is moving towards a career model
and away from a 2 year analyst model.

[http://www.mergersandinquisitions.com/2013-investment-
bankin...](http://www.mergersandinquisitions.com/2013-investment-banking-
bonuses/)

[http://www.businessweek.com/news/2012-09-13/goldman-sachs-
st...](http://www.businessweek.com/news/2012-09-13/goldman-sachs-stops-giving-
two-year-contracts-to-junior-bankers)

~~~
rayiner
How is "120-130K all in for top bucket in 2013" different from what I said
(average just over $100k)? I'm thinking average at GS/MS/JPM for first years
was ~$110k, no? As for Goldman, I'm aware they're getting rid of the contract,
but it's still standard practice in the industry as a whole. Also, just
because the contract is going away doesn't mean "up or out" is going away. At
the end of the day you have to weight those high salaries for more senior
bankers against the fact that the recruiting model of investment banks
involves only a fraction of new hires making it even past a few years.

~~~
ajiang
Just over 100k and 130k or $160k (Moelis) makes all the difference for what
the parent comment said, which is that bonus is is 100-125% of base (65k)

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rayiner
No, parent comment said: "Bonus is _probably_ 100-250% of base, and _a lot of
times_ the 100% part is guaranteed."

The plain meaning of that is that $130k all-in (100% bonus) is typical, and
often guaranteed, with the top bucket being over $225k (250% bonus).

With first-year salaries at Google, etc, pushing $120k+, that's a very
relevant difference. It's not accurate to imply that a first-year analyst at a
bank could make up to $100k more than that.

~~~
ajiang
You're right, I misread the top end of that range. Top trading firms get close
to that, (e.g. Jane Street), but $225k is probably pushing unlikely until your
3rd year.

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squeed
I graduated with a degree in CS from Columbia in 2007, at the peak of the
finance boom. Most of my classmates at least considered a job at an i-bank; a
lot of us had internships. I had a sweet job offer from Morgan Stanley waiting
for me that I turned down to leave NYC for good (good riddance!). It was such
a crazy time then, but it was all we knew. There was a constant stream of
crazy, lavish recruiting events on campus from all the banks; it seemed like
everyone was going to go work for them and that was normal.

Three years later, and the only people in my cohort who still work at the
banks are those who seemed to be in the lower tier of students. Everyone else
had either moved to GOOG, a start up, or San Francisco. I'd love to see what
the on-campus culture is now.

~~~
rgbrgb
I just graduated from Columbia CS last year and what you describe your friends
doing now seems to be the norm for seniors looking for jobs. Google definitely
had higher profile recruiting events than any of the banks. There are still a
few looking at jobs in the finance sector but not nearly what I had heard
about coming into Columbia.

~~~
squeed
Awesome, glad to hear that. I was president of the ACM for a year, and we
totally stuffed our budget from organizing i-bank recruiting events.

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walshemj
Yes but when you actually look at this in detail by reading the comments of
real IB types - a lot of those hours are just presentism they dont really do
much more in an 8:30 till 11 Pm day than you would in a normal 8 hour day.

~~~
chrisgd
They do a lot, but it is just iterating the same thing over and over.

~~~
rmcfeeley
Once, I made the mistake of asking a more senior IB analyst the following
question at a party (I did not know him well):

"Some junior investment banking analysts work over 100 hours a week. There is
no way that anyone is firing at full steam mentally pulling those hours
weekly, because science. Why don’t banks just hire twice as many analysts and
pay them all half as much to get more intellectual bang for their buck?"

He was not pleased.

Thoughts on what this means for our changing economy (and brunch):

[http://robmcfeeley.com/post/65530961398/goldman-sachs-
encour...](http://robmcfeeley.com/post/65530961398/goldman-sachs-encourages-
junior-bankers-to-take)

~~~
jsun
Banking is a relationship business. The hours aren't so much for productivity
as for bonding. Think of it as a frat initiation ritual that lasts years. Some
very small portion of IB analysts remain in IB, most move off and become
successful somewhere else, building an incredibly strong network of captains
of industry over time, all tied back to that particular investment bank.

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nilkn
Investment banking jobs are also, generally, available only in NYC,
specifically Manhattan, where the cost of living is matched only by San
Francisco (in the US). There are still many high-paying jobs in software
development in a variety of cities outside of the major tech hubs.

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paddy_m
What a horribly edited story.

Word that Goldman Sachs is discouraging its junior investment bankers to take
weekends off initially prompted scoffing.

That sentence is awkward, and I understood it to be the opposite of the
meaning implied by the following sentence.

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itcons
Are you kidding me? I've worked in tech consulting since leaving university,
spent a lot of time at Accenture and have worked just as many hours per week
as my friends in the big 4 banks.

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ethanazir
maybe they are trying to disclaim blue law violations.

