What did your parents do when you were growing up? Were they senior managers, doctors or lawyers? Try a career in banking. Were they senior administrators? Banking is also for you. But if they were manual workers of any shade, unless you’re determined you’ll probably find banking jobs harder to break into.
This is the implication of a survey of 1,184 visitors to eFinancialCareers in the UK. We asked which social class their parents fell into – A (‘Higher managerial, administrative and professional’), B (‘Intermediate managerial or administrative’), C1 (‘Supervisory, clerical and junior management’), C2 (‘Skilled manual workers’), D (‘Semi-skilled and unskilled manual workers’) and E (People on state benefits). The results were illuminating.
Bankers’ backgrounds by social class
As the chart below shows, most (67%) of financial services professionals in the UK come from families in social classes A or B. Interestingly, however, aspirational ‘B families’ sire more bankers than As.
Middle class bankers more likely to have expensive qualifications
Historically, traders in London were notoriously drawn from the blue collar East End. So why are today’s City bankers from middle class families?
Qualification inflation has something to do with it. As we noted earlier, nearly 30% of people in banking now have some kind of Masters qualification. A Masters in Finance costs £20k+ ($32k+) – so it helps to have parents who can contribute.
Our research confirms that middle class bankers are more likely to have postgraduate qualifications. Interestingly, however, bankers from C1 family backgrounds are equally likely to have a Masters qualification as bankers whose families fell into the A category, suggesting pressure to achieve postgraduate qualifications may be felt more acutely among aspirational students outside the upper middle classes (we’re surmising that students from A families might be more likely to go for a Masters as a matter of course…)
Meanwhile, comparatively few people whose families weren’t in categories A or B are equipped with an MBA (costing £40k/$65k) and bankers whose parents came from the lowest social grouping tend to rely entirely on a bachelors degree and/or cheaper industry qualifications. The educational data is contained in the chart below. (Click to enlarge.)
London bankers’ qualifications by social class of parental household
Is the ‘professionalisation’ of banking making a meritocratic industry classist?
Banking is supposed to be meritocratic. If you listen to Lloyd Blankfein at Goldman Sachs, then Goldman supposedly sets out to hire people who have overcome ‘adversity’ and escaped challenging family backgrounds. Blankfein himself grew up in the Bronx and was the son of a post office worker. Sidney Weinberg, a former CEO of Goldman Sachs, was one of 11 children and the son of a Brooklyn bootlegger.
However, Goldman Sachs today employs the most highly qualified bankers of the lot – and those qualifications don’t come cheaply.
Finance firms seem aware of the class issue. For example, JPMorgan has launched a schools programme to help broaden its net of applicants in the UK, and Goldman Sachs Gives has donated money to help improve educational opportunities in low income areas.
Nor is social class always a guarantor of a job in banking. While British aristocrats like Jake Astor (son of Viscount Astor) may have their Oxford degrees, Wharton MBAs and jobs in hedge funds, Eton-educated Leander Cadbury (heir to the Cadbury chocolate fortune) didn’t seem to convert his internship at UBS into a graduate job last summer. An impeccable family pedigree isn’t all banks are interested in.