Goldman Said to Boost Salaries for Junior Staff About 20%
Goldman Sachs Group Inc. (GS), which cut the portion of revenue set aside for pay the past two years, will increase 2015 salaries for junior employees in the U.S. by about 20 percent, according to a person briefed on the decision.
The raises will apply to employees in all divisions with the title of analyst, typically recent college graduates, said the person, who asked not to be identified speaking on personnel matters. The increase won’t affect bonuses, which are based on the firm’s and employees’ performance.
Goldman Sachs and other Wall Street firms have been cutting hours and attempting to improve working conditions for junior bankers as the companies seek to prevent defections to competitors such as private-equity funds. Investment banks including Credit Suisse Group AG and Bank of America Corp. have encouraged analysts to take time off on weekends.
Morgan Stanley is raising salaries for associates and vice presidents in its investment-banking and underwriting units worldwide by about 25 percent, a person briefed on the matter said last month.
Goldman Sachs’s salary increase will bring some first-year analysts’ annual base pay to about $85,000, the person said. Such employees typically are paid $70,000 to $90,000 in salary, with bonuses bringing total compensation to as much as $140,000, according to New York-based consultant Johnson Associates Inc. The junior-banker title doesn’t refer to research analysts who recommend stocks to investors.
Andrew Williams, a Goldman Sachs spokesman, declined to comment. The New York Post reported on the pay increases earlier today.
In 2012, Goldman Sachs decided to stop offering two-year contracts to investment-banking analysts, instead making them full-time employees from the start. Last year, it discouraged them from working weekends and pledged to hire more junior workers to prevent overloading.
Goldman Sachs set aside 37 percent of revenue for pay last year, down from 38 percent in 2012 and 42 percent in 2011. The ratio was 43 percent in the first half of 2014, the same as a year earlier.
To contact the reporter on this story: Michael J. Moore in New York at email@example.com
To contact the editors responsible for this story: Peter Eichenbaum at firstname.lastname@example.org Steven Crabill