Compensation on Wall Street has taken a big hit this year, there’s no doubt. But the average decrease in year-end pay – estimated to be around 30% for stock traders this year – won’t be spread evenly. Instead, Wall Street is robbing a handful of Peters to pay Paul, their smarter and more successful colleague.
The idea, explored in detail by The Wall Street Journal, is that the world of finance has evolved into an even stricter meritocracy, where the best and the brightest, especially those who bring revenue in the door, are treated with pre-recession gloves. Middling performers, meanwhile, are having their bonuses stripped or being let go altogether.
Roughly 20% of Wall Streeters won’t receive a bonus check this year, according to new research. That money, along with cash saved from eliminating redundancies, will be channeled to top-ranking employees, giving them reason to stay put in a difficult climate.
"It's going to be uneven," one recruiter told the Journal. "If you are a valuable person to your employer, they will want to keep you, and the only way to keep people is financially these days.”
Goldman Sachs presents the best example. The firm was perhaps more dedicated than any rival in eliminating redundancies and just increased its average compensation for remaining employees by 15%.
Eyeing Profit (Bloomberg)
With staff reductions formally announced, UBS has increased its profitability goal – from 12% previously to at least 15% starting in 2015.
Awkward Goodbye (Financial Times)
Some UBS fixed income traders in London found they had been let go on Tuesday in a fairly non-personal way: their building passes weren’t working when they showed up to the office.
Hurricane Fallout (Bloomberg)
Hurricane Sandy halted equity trading for the second straight day on Tuesday, marking the first time in over a century weather has shut down the market on consecutive days. The hurricane isn’t expected to trigger market declines.
Consultancies Thriving (Fortune)
With headcount at buyout firms thinning, a need has grown for consulting companies like Accordion Partners that can provide much-needed analytical help at the drop of a hat.
BofA Hiring? (Forbes)
Forbes just published its list of the 10 companies hiring the most right now and, surprisingly, Bank of America comes in at No. 7 with more than 10,000 job listings.
Healthy Mortgage Activity (Barrons)
Regional banks in the northeast and southwest – including M&T Bank, KeyCorp and Zions Bancorp – are seeing a healthy uptick in commercial and industrial mortgage activity, despite fairly cautious forecasts, according to Credit Suisse.
Quiet Additions (eFinancialCareers)
Nomura has been cutting staff consistently in Europe but has quietly added more than 100 employees in the U.S. over the last year.
Buzz Around the Office
When at First You Don’t Succeed…(BuzzFeed)
A Baptist church in Kansas posted a note on its website encouraging followers to picket the funeral of former Democratic Vice President Walter Mondale. The only problem was Mondale is still alive, so they instead picketed the funeral of late Sen. George McGovern. Ironically, Mondale was in attendance.
List of the Day: Getting Laid Off
Getting laid off is a difficult experience. Here’s how to respond.
- Stay positive, at least publicly. Very few offers are made to those who are despondent.
- Take an honest look at your skillset and identify areas in need of improvement.
- Keep on ongoing list of people to talk to, events to attend and companies to research.
(Source: The Daily Muse)