Bankers are facing pay cuts this year against the backdrop of slowing business activity and deteriorating economic conditions. about 3 out of 4 One of them responded to a survey that they would consider resigning if their bonuses were cut.
Professional social networking app Fishbowl conducted a survey of 1,096 bankers at companies including JP Morgan, Goldman Sachs and Morgan Stanley, asking them whether they would consider leaving their jobs if their company cut their bonuses in the next bonus cycle.
72% of the people involved in the survey answered yes.
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In 2021, bankers got huge bonuses for a record year of M&A and IPOs, but consultancy Johnson Associates expects bonuses this year up to 45% off By slowing down that activity.
“Most people think this is the worst year since the financial crisis,” analyzes business Insider Alan Johnson, Director D Johnson Associates.
Goldman Sachs premium expected worst on Wall Street, and traffic light has already informed that the set premium for the partners of the company may be cut by 50%.
Investment banking premiums at Goldman could be cut by up to 40%, compared to plans for premium cuts of 30% at companies such as JPMorgan and Citigroup.
More than half a dozen Goldman CEOs and partners have recently announced business Insider that CEO David Solomon is facing growing ire, and that the company could see several senior managers step down over the next year.
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The outcry stems from Solomon recently telling executives that pay cuts should be distributed across the bank in solidarity, not just troubled departments like consumer banking, which has lost the company money for 3 years .
“People are worried about layoffs and the kinds of layoffs that have affected the highest paid workers,” says a person familiar with the situation. “These are people you don’t want to lose.”
Johnson Associates has already predicted which investment banking underwriters will see the biggest reductions in their premiums: between 40% and 45%,
Other tech M&A employees may also face layoffs and a slowdown in hiring, according to Alan Johnson. At the other end of the scale, investment bank advisors would likely only see their premiums cut by 15-20%.
Although the Fishbowl survey is limited, it is a signal to corporate management that bankers, both junior and senior, are not afraid to walk away if they don’t feel properly compensated.