Investment banking has a reputation for being elitist, but it’s the private equity and asset management sectors that tend to employ private-educated Oxbridge graduates in the UK, and progress them up the ranks.
A new study from the Boston Consulting Group on behalf social mobility charity The Sutton Trust shows that for a lot of British-educated students from state schools, a career in financial services still remains elusive.
Almost 70% of those hired into the sector went to a top-30 university, says the study, and a large proportion of these went to Oxbridge. Around 42% of Oxbridge students are privately educated, it says, but they make up 65% of those securing a job in financial services.
However, while 51% of those working in leadership positions in the banking sector were privately educated, 68% of managers in private equity went to independent schools and this figure was 61% in the asset management sector. This elitism in private equity’s upper ranks isn’t surprising when you consider that 56% of new hires went to Oxbridge and 69% attended private school.
What’s more, those from higher income backgrounds and a top university were more likely to secure a job regardless of their degree discipline, while lower income candidates from less prestigious schools were only offered a position if they studied maths, economics or management – the mainstays of the financial sector's graduate recruits.
The report is more of a call to action from the Sutton Trust, which has convinced Barclays, HSBC, Lloyds Banking Group and Deutsche Bank to sign up to a £2.75m scheme to encourage students from lower incomes to consider a career in banking. Targeting these students early, encouraging them to study more mathematical subjects and apply to top universities is key to addressing the imbalance, it says.
This is the latest in a series of moves by the big banks to do so, following Credit Suisse’s Steps to Success programme, that targets ‘outstanding’ A-level students from London boroughs Tower Hamlets, Newham and Lewisham, and JPMorgan’s Residential Internship, which is aimed at academically bright students from poorer backgrounds.
In the UK, 30-40% of all jobs paying over £120k are in financial services. The BCG report suggests that only exceptional students from poorer backgrounds will make the cut, while it’s decidedly easier for those with a privileged education to make it in, and progress. Here are the key stats by sector: