Morgan Stanley boosts pay for junior bankers worldwide
Morgan Stanley has raised base salaries for entry-level bankers in its investment banking and global capital markets division, following in the footsteps of Wall Street rivals.
The US Investment bank has hiked base pay to $100,000 for first-year bankers and a minimum of $105,000 for second years, according to people with knowledge of the matter.
In an internal announcement on Wednesday, the bank said the changes were based on a review of annual compensation against market conditions, and would come into effect on 1 August.
It means that Goldman Sachs is the only Wall Street bank that has yet to raise pay for junior bankers, after rivals Citigroup, JP Morgan Chase, Bank of America, Barclays, Nomura and UBS all made a similar move in the last few months.
The banking giants have been strengthening incentives for younger workers after up to 70 per cent of junior bankers quit their roles due to burnout from severe workloads since the onset of the pandemic.
A group of first-year analysts at Goldman Sachs leaked a presentation to senior staff stressing they had routinely been working 80-hour weeks over the last year, sometimes rising to 100-hour weeks during busy deal periods.
But since then, the bank has not responded by hiking pay to six figures like the new trend with its rivals, but in its recent second quarter results call, chief executive David Solomon implied a pay rise may be on the cards for junior bankers in August.
So far, Goldman has begun a recruitment drive in response as well as automating more junior workloads, while JP Morgan is hiring 190 analysts and associates to support junior staff.
Morgan Stanley declined to comment on the change.