Many have long tried to draw employees from a more diverse pool. That task is now more urgent, and goes beyond obvious lines
AFTER A DISMAL decade, bankers of all stripes had reasons to be cheerful last year. Eighteen months of soaring corporate dealmaking generated blockbuster fees for mergers and acquisitions desks. Their counterparts in debt advisory played midwife to a deluge of newly-minted bonds. Bouts of high volatility buoyed traders’ revenues. The dealmaking frenzy may have cooled a little in 2022, but lenders are licking their lips at the prospect of sharply rising interest rates.
One popular line of argument holds that banking is the victim of a generational shift. Everyone from hiring managers to university careers services reports that young workers care less about salary and more about work-life balance. Most of all, they want to work for a company with a clear social purpose. All of that puts the recruitment model for traditional financial firms—high pay in return for gruelling hours, and work with a social value that is not immediately obvious—at risk.
All that equates to an avalanche of work for investment bankers. The industry’s staffing model, meanwhile, is ill-suited to spikes in demand. “If the large banks aren’t able to pay their best people well, they lose them all,” explains one headhunter. The only way to do that and remain profitable is to be ruthless about headcount, running teams with “very little fat” in normal times.
That works in banks’ favour for recruiting junior staff: their graduate schemes are still seen as excellent preparation for a career. But it also puts pressure on attrition rates in an industry already known for the mercenary outlook of its employees.
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