Bankers are paid a lot. However, there's a good reason for this - they live under the threat of constant redundancy. As veteran banker-turned author Philip Augar noted in the Financial Times yesterday, the average front office banking career lasts just 20 years. After that, the ex-bankers fan out to become entrepreneurs, mountain men, or recruiters.
Since 2010, nearly 20% of all front office (ie. client-facing) bankers globally have been laid off, according to new data from research firm Coalition. In fixed income sales and trading 27% of people have disappeared. In equities it's 16%. In investment banking divisions (IBD - comprising M&A and capital markets bankers), 13% of people are no longer around.
[efc_twitter text="If investment banking were a neighbourhood, the streets would be partially empty."]
Nor is the picking-off finished yet. Coalition thinks banks will dump another 10% of their fixed income sales and trading bankers over the next twelve months. Suddenly, FX traders' lamentations over their lost bonuses don't look so misplaced after all.