Junior bankers are being paid more. Or at least they're being paid higher salaries. Or at least they're being paid higher salaries at some banks than others. US banks like Morgan Stanley, JPMorgan and Goldman Sachs are said to be paying up to 25% more in salaries than they used to. European banks are humming and hawing about whether they ought to do the same.
So far, so good, except how much will you actually get paid if you spend your early 20s working in banking? And is it worth working for a U.S. bank, where the hours are notoriously nasty, just because they pay so very well?
A new chart from Emolument.com, the 'real time salary data specialist' which asks bankers to submit their compensation via its website, suggests that yes - if you're a junior M&A banker, you should work for a U.S. firm.
As the chart (below) clearly shows, U.S. bankers pay their analysts, associates and VPs in M&A a lot more than European banks. If Emolument's figures are correct, European banks look horribly parsimonious. Worst, they stand accused of paying everyone badly except their managing directors. A bit like private equity funds, in other words.
Not everyone agrees with the simple "European banks bad; US banks good" narrative, however. One top M&A headhunter in London, speaking on condition of anonymity, says M&A salaries across the industry vary widely and are not split according to the nationality of the banks concerned.
Yes, he says, one U.S. bank has just hiked salaries for third-year associates in the City to an unprecedented £123k ($204k) - far higher than anywhere else. But he also says that one European bank in the City pays its first-year vice presidents £150k ($249k). "That's also higher than the big U.S. banks like Goldman Sachs and Morgan Stanley," he points out.
Dartmouth Partners, the recruitment firm specializing in junior and mid-ranking hires, produces a salary and bonus survey showing pay levels across different banks in the City. The last time this was made public, in 2012, it suggested that Deutsche Bank and Credit Suisse were some of the best payers at associate level when salaries and bonuses are factored in. "It's increasingly simplistic to say that American banks always pay more than Europeans," says Logan Naidu, founder and CEO of Dartmouth Partners, about pay today. "It's much more nuanced than that."