Banks including JPMorgan, Goldman Sachs, Citigroup and Bank of America are scrambling to hire junior bankers as a surge in workload during one of the busiest starts to the year in decades has led to increasing concern over burnout and mental health.
Those banks have around 175 vacancies for analyst and associate level positions for their advisory units in the US and Europe, according to analysis of their careers centres.
They are looking to beef up the junior ranks as working weeks have edged above 100 hours this year, and analysts have cited increased mental health problems as the Covid-19 pandemic has worn on.
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“This is the busiest hiring market for junior investment bankers for over a decade,” said Logan Naidu, chief executive of recruiters Dartmouth Partners, which focuses on junior and mid-level banking hires.
“There’s been the usual exit to private equity and start ups, a little bit of trimming headcount and then the pandemic effect of people questioning their career choices,” he said. “Now, the investment banking market has come back, and banks need both replacement hires and are growing. We haven’t had this for quite some time.”
Goldman Sachs is ramping up junior recruitment in the wake of a scathing presentation by a group of 13 analysts outlining 100-hour weeks and declining mental health. In a message to employees on 21 March, its chief executive David Solomon, said the bank would hire more juniors as well as enforce its rules to keep Saturdays free for analysts.
The bank is also “internally transferring bankers to business lines where activity levels are highest. We’re also being more selective about business opportunities that we pursue, and we’re working to automate certain tasks in our business,” Solomon said.
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“Investment banks are giving out exploding offers and becoming increasingly flexible with the junior recruits they take on,” said Andrew Pringle, director of investment banking recruiters Circle Square. “Right now, banks are willing to speak to newly-qualified accountants working in transaction services roles of Big Four firms. When that happens, you can tell the market is manic.”
Goldman currently has around 20 vacancies for analyst and associate level positions, while both JPMorgan and Citigroup have between 30 and 40. Meanwhile, UBS has about 25 junior roles across the Americas, Morgan Stanley has 15 vacant positions and Bank of America has around 20 open jobs for juniors.
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“Hiring was not as robust during the pandemic, so there’s a rush to recruit talent at that level in anticipation of the pandemic turning the corner and a return to the physical office as many top bank CEOs are urging,” said Roy Cohen, author of the Wall Street Professional’s Career guide and a career coach who works with large investment banks.
One senior banker said the recruitment drive was less about alleviating workload for juniors and more a reaction to the “unprecedented volume of deal activity”.
Banks were already facing a battle to retain juniors, with analysts quitting in greater numbers as the pandemic has worn on, even if they had no job to move on to, according to conversations with juniors. Goldman’s move to reduce working hours and increase its ranks of analysts will put pressure on other banks to do the same, according to analysts contacted by FN.
“If one changes, the others will have to follow,” said one former Goldman analyst.
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The Goldman Sachs analysts described the working hours as, among other things, “inhumane”. Solomon praised the juniors for coming forward with their concerns, saying the bank wants to “encourage all of you to take the opportunity to speak with your management”.
Senior bankers contacted by FN last week showed little sympathy for the Goldman juniors, with many saying it was a rite of passage.
“The more work that’s thrown at juniors, the faster and more efficient they become,” said Cohen. “They learn how to work under extreme pressure and to deliver. It’s viewed as a rite of passage. Just like medical training and army boot camp where you learn by doing.”
Naidu pushed back on that narrative, which he says has changed: “Historically, you knew what you were signing up to and the tradeoff was the chance to earn life-changing money or pursue an exit option into private equity. Now, people are less willing to do that, and there’s an idea that work should be more holistic and enjoyable.”
One analyst who has worked for both US and European investment banks said to reduce working hours, firms would either have to bolster numbers and reduce salaries for juniors — which would dent its appeal — or hire more and keep pay at the same level, which he said was unsustainable and would eventually lead to job cuts.
“People will make the right noises to bury the news, but the reality is that they will go back to the old dynamics, very likely after the pandemic ends,” he said.
Protected weekend days with juniors have ebbed away in recent months as deal activity has picked up. Even among banks that enforce the days off, juniors are required to check in to make sure there is nothing ‘business critical’ to deal with on a Saturday.
In normal times, this makes it difficult to make plans, but during lockdown there’s an assumption that most people will always be available, according to two analysts.
Added one of the analysts: “There will always be something ‘very urgent’ on a Friday night, or on Sunday morning, or after we have worked for three weeks surviving on four hours’ sleep a night.”
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