With some tragic headlines recently, investment banker's working hours have come into focus. We ask if the all-nighters, office dinners, and 3am cabs are worth it when it comes to pay?
A career in Advisory is clearly the most lucrative: from very junior Analysts, all the way through to Associate, VP and Director, bankers on average make more in advisory than they do on the markets. The gap stands at USD 16,000 at Analyst level, up to USD 60,000 at VP level. A substantial difference. However, with gruelling 80-100 hours working weeks, the job can take its toll on physical and mental health, social and family life.
With an average 30 hours extra per week in advisory, however, the pay per hour is more attractive in markets-related jobs which remains true throughout a bankers' career: an analyst working in advisory makes USD 26 per hour vs. USD 34 for his peer on the trading floor.
At GBP16 per hour, junior analysts in Advisory are dealt a rough hand. Notoriously known for their unsustainable hours, cancelled vacations, desk dinners and 3am cabs home, their lifestyle compares poorly to junior traders and markets analysts, making GBP21 per hour. Further along at VP level, the spread is still depressingly visible at GBP56 and GBP72 per hour respectively.
Sales people and traders though will be able to buy rounds from 6pm, go on flash holidays which are unlikely to be cancelled, shop, and generally have more time to enjoy their cash. Considering they make less overall (except at MD level), than their peers in advisory, this may mean a considerably lower balance on their account come year end.
Markets senior executives spend more and more time in meetings beyond standard trading hours, while on the advisory side, MDs are able to delegate much of the legwork to more junior bankers and therefore unlikely to be in the office past their bedtimes. Despite a narrowing gap in working hours between advisory and market activities at senior levels, the wage-per-hour differential remains blatant with trading floor executives making USD 65 per hour more than MDs in advisory. This is due to the substantial uptick of annual pay packages for markets MDs.
A career in advisory or markets require very different skills and temperaments. Whilst those on the markets side earn more on an hourly basis, the additional stress involved in dealing with unpredictable and volatile markets may not be to everyone's taste. The longer hours worked in the Advisory side are at least somewhat compensated by higher total remuneration.
Figures sourced from 2.520 entries of front office professionals in London working in Markets (sales/trading/research) and Advisory roles
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KNOW WHERE YOU STAND