Nearly every big bank is following the same game plan. Increase the hiring of analysts and associates while cutting costs and reducing headcount. The end result is the pruning of high-salaried senior bankers.
But unlike years ago, when people were pushed out of the industry in their fifties and sixties, the guillotine is now falling on middle-aged bankers, our new diversity survey suggests. Understandably, fear has struck the 40-year-old banker.
When asked how worried they would be that their age would be an obstacle if they were forced to find new work, roughly 85% of US bankers aged 41 to 50 said they were either “somewhat concerned” or “very concerned.” One in three (32%) said they were “very concerned.”
Contrast that level of fear to that of bankers just a few years younger – people aged 36 to 40 – and the sentiment changes dramatically. Just 9% of US bankers in their late 30s are “very concerned” about their age affecting their prospects of getting a new job. It appears just a few years can make a massive difference.
The numbers are similar, albeit a bit less polarizing in the UK, where 21% of bankers aged 41 to 50 are “very concerned” that age would be an obstacle in finding new work. That number drops in half – to 10% – for people in their thirties. Of UK bankers aged 41 to 50 years, a third (33%) have felt discouraged from applying to a position on the grounds of their age.
In Asia, 40-year-olds are equally as fearful. More than 40% of Singaporean bankers aged 41 to 50 would be “very concerned” about their age during a job search. That number is 23% in Hong Kong.
Interestingly, fear over age creeps in earlier in Asia as compared to the US and UK, where the vast majority of 30-year-olds feel confident. One-quarter (25%) of Hong Kong bankers aged 36 to 40 fear age are “very concerned” that age would play a factor in their job search. Around two in 10 (21%) feel the same way in Singapore.
So why has 40 become such a key number when it comes to fear over finding a new job? Really, it’s just a reaction to the realities of the new Wall Street, says Neil Patrick, a former banker who is now the editor of 40pluscareerguru, a blog about career challenges facing baby boomers. Patrick says the confidence bankers have in themselves plays no factor in their sentiment. Rather, it’s an issue of cost and perception.
“I think there's a persistent belief amongst employers that being young, hungry and eager trumps age, wisdom and experience, even in areas where knowhow would seem to be critical,” Patrick said.
This is especially true in investment banking, where – rightly or wrongly – the perceived ability and willingness to work long hours is still critical, he said. “People in the 40+ age bracket typically have families and others view this as detrimental to their ability to commit,” he said.
Then, there’s the money angle – both in terms of how much 40-year-old bankers tend to make (why they are more prone to get let go) and how much they spend (why they are so concerned).
“Older bankers therefore feel they MUST earn a lot more simply because they need to – and that they deserve it because they've paid their dues,” Patrick said.
The end result is a host of nervous 40-year-olds who understand their reality all too well. In the current market, they are expensive and expendable.