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So you think you’re underpaid?

Here, slightly belatedly, are the results of our global bonus survey. It was conducted last month, in the days before Bear Stearns was totally subsumed by JPMorgan or Bradford & Bingley cast a deathly pallor across the British banking sector. The main conclusion? You don’t think you’re being paid enough.

A total of 938 of you responded to the survey. A hefty 62% thought you should have been paid more for your efforts in 2007.

This may be because, on average – and despite last year’s bonuses being generous – you were paid fairly modestly.

Only 18.6% of respondents received bonuses in excess of $200k. And 46% received less than $50k.

The results may have been skewed by the inclusion of responses from the likes of Singapore, where bonuses are typically lower than in London and New York.

However, it also goes to show that while some people working in financial services make enough to retire while they still have all their hair, the vast majority really don’t. This is confirmed by stats from the Centre for Economics and Business Research, which suggest the average City of London bonus for last year was 24k and the average bonus for 2008 will be a meagre 14k.

Despite feeling underpaid, the vast majority (86%) of respondents to our survey said they’d never knowingly misrepresented their role in a transaction to wangle more money from their employer. However, 70% said the current system encourages emphasis on short-term performance, and 50% said the bonus system should be reformed.

What would bonus reform look like? Most people said bonuses should be averaged over the cycle. But a few (three) felt moved to suggest bonuses should be paid on a monthly basis along with salaries.

Comments (19)

  1. Not everyone working in banking is earning fortunes and deserves to be taxed to death. The media is responsible for this fallacy.

  2. I can’t believe these numbers are so low – 46% received less than $50k? Shows that this site is full of back office cretins, recruitment types rather than alpha males. No wonder nobody believed me when I gave my numbers. The truth is, if you’re in London and good, last year you’ll have received a 6 figure bonus (in sterling) at the end of your 2nd year analyst in 07. 14k average bonus this year? Does that include the cleaners and back office peasants? LOL. These guys really give us a bad name, wish they’d just focus on the front office in such surveys so we’d get more admiration and respect for making so much.

  3. Goes to show bulk of people who read this site are graduates and non front office, as expected.

  4. Oh come on! The bankers got us into this mess, and now say they should be getting paid more for their little conribution. That is beyond the pale.

  5. Peter – so you assume every single banker out there worked on sub-prime? There are plenty of people working in unrelated areas who will get a hit in pay as a consequence though. This is fair?

  6. Of course bankers are underpaid. I achieved 10A*s at GCSE, 5As at A-Level and a 1st class from LSE, all whilst doing internships, part-time work and extracurriculars. I’ve worked 100 hours a week throughout my studies in continuous improvement, developing both my academic/intellectual and interpersonal skills to be the very best. My bonus at end of my first year was 54k, and I deserve every penny of it and more for being so much harder working and talented than my peer group. It is ridiculous that people who worked one tenth as hard as me still get 20k jobs – and without the 40% tax burden! For being infinitely higher calibre, harder working and more talented, I deserve many multiples more in my paypacket.

  7. Patel, the only thing that you lack is a little modesty and sense of reality. You don’t leave in the perfect neardy world you learned so hard about in LSE.
    Financial markets are built on greed but you shouldn’t confuse luck, talent and the ability to exploit an opportunity with hard work. I bet there are many thousands working a lot harder than you in the world and they gain a tenth of what you get but they just didn’t have the opportunity to study at LSE.
    Be reasonable and stop looking at the others wih envy!

  8. agree with henry there! you can’t compare some back-office dork with a profit machine that pushes the company’s numbers up. reading about some of these bonuses made me laugh though – so thanks for this article! I wouldn’t even get out of bed for 24k bonus…

  9. C – Not necessarily – I earn more than Patel and didn’t study at all. Sometimes it’s just about skills and knowing where to apply them…

  10. With Fred here. Patel, you might be highly qualified and very successful, but it doesn’t stop you being a PITA. Working with people who like you and so up themselves is in itself a pain. Get a life, get a girlfriend and see your job in perspective: you work with good people, you learn, you progress. You are not better than them, or their counterparts in middle and back office, who earn a fraction of what you do. You’re just lucky and good at exams. Get over yourself

  11. Admiration and respect? LOL for having a big paycheck? Or for bringing down the financial system? It’s not like people in IB work for a better society. Go work to some NGO in Africa and you’ll earn admiration, Anyway, try to understand that how valuable a person is doesn’t depend on how much money he or she makes. You seem to be very arrogant, I hope there is something else in your life other than the balance in your bank account.

  12. These numbers are not a surprise. It has been known for some time that the reality of City pay rarely matches the hype.

    The average total salary in Canary Wharf is just circa 100k, while the average bonus for all financial workers in London was around 20 – 45k this year, depending on whose numbers you believe.

    When you factor in the high living-costs, the crazy commute and the many unpaid hours, then the real wages of City types are not really that high.

    I would wager that 80% of workers are getting relatively modest bonuses; 15% are getting good bonuses; and a tiny 5% are receiving huge payouts. Most people are making nowhere near as much as the papers would have you believe.

    MBA & CFA Grad Reply
  13. Why do people outside the City always assume we’re all responsible for the subprime / credit crisis?!

    170k… nothing to do with subprime… thank you very much.

  14. These figures can’t be representative of the sector…I agree there is backoffice inside or something else.

    received in 2008 a new offer, Associate in PE, package tot $295k (no carry)…nothing more, nothing less than the standard packages..

    Who is included in the stat?

  15. I got 300,000 pounds bonus ($600,000) lasy year. Add that to the survey.

    NYC iBanker (mid-level) Reply
  16. Looking at these responses shows how arrogant and stupid most people who work in banking are.

  17. I can not actually understand these people – I mean really get over yourselves, I have a great job which I love and am well paid for in a creative industry but check this site sometimes as I was going to go into finance and sometimes like to see if I should do my Masters and switch. If everyone in Finance is so egotistical and sad as to think that they are the only ones worthy of anything in the world then I am very happy that I am not a part of that.
    Come on guys if you are earning a great wage ( as I am ) then you should be appreciative that you have had the good upbringing, fortune and luck to be in the position you are in and not penalise the rest of the world. There is a need for everybody otherwise this capitalist ideology you are reaping the benefits if would cease to exist.
    And you claim to be educated…

  18. I agree with Michelle and Tim. How any of you actually have the time to read this chain and still earn your hefty bonuses is beyond me. I am on a modest salary in the online marketing industry and while my employer doesn’t allow me to cream company profits in the form of a bonus I still find my job completely satisfying. I think it’s more rewarding to be motivated by something that interests you and you believe in, rather than because you can brag to your peers about how big your bonus is. Your pay check, like the size of your manhood, does not determine how great a man you are.

  19. Kajal Patel, Derivatives

    Being an ethnic you would be underpaid which is a fact. All you get is 54K with your academics is ridiculous. Hence why you shousl really start your own business my child

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