If you want a high-paying job in compliance, keep your eye on the headlines. Scandals not only generate openings – they also create desperate employers ready to open their wallets.
The most recent look at the market for compliance personnel has improved on an already optimistic diagnosis. The bank most desperate for compliance staffers, scandal-plagued J.P. Morgan, is now paying consultants north of $100 per hour, according to the Wall Street Journal. That’s up from $60 per hour at some smaller banks that don’t grace the pages of global newspapers quite so often.
J.P. Morgan has little choice. The bank, which has paid more than $20 billion in fines over the last year, needs warm bodies. Chief Executive Jamie Dimon said recently that, by year-end, the bank will have hired 13,000 employees to support regulatory compliance efforts.
The two other firms with lofty hiring goals – Citi and HSBC – have had their own troubles. Citi is reeling from the Banamex loss and its failing of the Fed’s stress test, while HSBC continues to deal with tax evasion claims.
While compensation at these firms likely leads the industry, overall pay for compliance personnel was up 5% last year, which beat earlier estimates as well as salary increases for other roles in banking, according to the Journal.
Looking ahead, competition for trained compliance staff should only increase, as should salaries. The Securities and Exchange Commission on Tuesday signaled that major oversight changes would be coming to the private equity industry. Planning for the worst, private equity firms are staffing up in compliance right alongside big banks.
“Legal and compliance is our fastest growing part of the firm by far,” Blackstone President Tony James told Bloomberg. In its review, the SEC found half of all private equity firms are showing “severe compliance shortfalls.”
What will be interesting to see is how long this run on compliance staff will last. Surely, hedge funds and private equity firms are just getting started. Banks too have more red tape to deal with, but much of the bulk hiring seems reactive. A bank lands in hot water, and it soon announces plans to hire thousands in compliance. What happens when J.P. Morgan has a clean 12 months?
Likely that’s why they’re hiring contractors. Get your money while you can.
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