Credit Suisse is sending its junior M&A bankers on secondment to work for clients. Now, Citi seems to be offloading its juniors on charitable work gap years.
The Wall Street Journal reports that Citi has introduced a new concept called 'Service Year,' under which its incoming junior bankers have the option to take an entire year out before they've even started, so long as they spend it working for a charity of Citi's choice. They'll get paid 60% of their salaries and will work for Citi when they've finished. Nine have taken the bank up on its offer already. Citi is also giving 12 of its existing juniors the chance to spend four weeks working on a micro-finance program in Kenya.
Four weeks in Kenya sounds appealing, but deferring your entry-level banking job for a year may be less wise. Citi's dressing up its "Service Year" in the clothing of corporate social responsibility - it's an opportunity for young bankers to do good in the world before they join full-time, but in the distant past banks have also been known to defer graduate hires in years when markets were weak. With M&A deals in some key sectors already plummeting and UBS said to be trimming junior M&A staff this week, who's to say you won't return from your year volunteering in Central America to find there's not much for you to do any more? The fact that banks have begun cutting their graduate recruitment targets for 2016 suggests they suspect the market is turning.
Recruiters who place juniors are cautious about recommending the Service Year. "Instinctively this just sounds like a bad idea," says one. "You're going to come back and be a year behind your peers and the oldest in your class. It's only really worthwhile if you're already burnt out before you've begun."
"This sounds the wrong way round," said a senior banker at another firm. "Work and THEN earn a sabbatical. After 7-10 years, yes."
Current Citi analysts are more approving, however. One said the gap year he took before he arrived at Citi helped him in his banking interviews - suggesting that a year out with an assured job to return to will give you something to talk about if you move on in future. Another said he would have been interested in the program and is leaving Citi because he wants to, "have a greater impact in the world." The Service Year might've got this out of his system....