The desire for work flexibility pushes junior bankers towards fund management

The Covid-19 pandemic has prompted junior bankers to reassess their work-life balance, with many looking to turn to careers in private equity or fund management.

Having been forced to work from home during the height of the pandemic, many have appreciated the flexibility that came with it and do not want to return to a full-time office environment.

Several large investment banks, including JP Morgan and Goldman Sachs, have started a return to the office for staff, both expecting to return to pre-pandemic conditions by the fall.

Asset management companies, however, have been less forthright about their plans for returning staff to the office, although Blackrock and T Rowe Price have said any return will include more flexibility for employees. Last summer, Schroders announced a permanent shift to flexible working.

“It seems that all junior bankers want to get into PE or fund management”

For junior bankers, however, it’s the increasing workloads, long hours, and the inflexible nature of the investment banker role that drives staff to seek less stressful roles.

“It seems that all junior bankers currently want to go into PE or fund management. Although it’s nothing new, the desire seems stronger than ever, ”says Simon Roderick, Managing Director of the recruitment firm Fram Search.

“The main reasons we hear are that investment banking can be transactional, whereas in fund management and private equity you can see it all the way through, and banking can be repetitive after a while. time. Covid has made us all more reflective, and bankers are re-evaluating their careers too. “

Covid has also been cited as the catalyst for fund managers rethinking their careers, following a wave of high-profile departures last year.

Read also: Does the Covid encourage a rethink of the career of fund managers?

Respond to the request

While the transition from banking to fund management or private equity does not require much retraining, the question arises as to whether vacancies exist for those who wish to make the trip.

A brief search of a few job boards suggests that there are around 2,500 vacant fund manager positions open in the UK, including at companies such as Investec, Columbia Threadneedle and M&G.

According to a study by the Association of Professional Staffing Companies (APSCo), vacancies in the financial services industry rose 37.8% between the first and second quarters, with hiring levels already at the end of July. 6.9% higher than last year’s total.

APSCo data reveals that among top companies operating in financial services, JP Morgan leads the rankings with 2,246 new jobs this year, an increase of 18.3% from its 2020 total. Citi follows in second place with 1,552 vacancies, up 39.2% year-over-year.

Of course, not all are fund management specific roles, but with companies taking steps to roll out hybrid work practices, it’s no surprise to see an increased demand for such roles.

“Our latest data shows that the recovery is well underway despite the challenges that the pandemic has presented, and this is certainly echoed by our members operating in the financial services industry who are reporting huge demand for their services,” says Ann Swain, CEO from APSCo. . “While we would expect to see this trend continue as we move forward throughout the year, it should be remembered that employers are grappling with huge talent shortages that are just around the corner. ‘exacerbated by the hiring boom.

“Therefore, professional recruiting companies will have a huge role to play in helping employers find the talent they need to thrive and avoid hampering their recovery.”

Retain talent

With so many junior bankers seeking a transition to fund management or private equity, investment banks face a significant talent shortage and, in response, many have increased the benefits offered.

This month Goldman Sachs announced it was increasing the base salary of its first-year analysts to $ 110,000 (£ 79,000) before bonuses.

They join several other banks that have reportedly raised junior bankers’ salaries to a minimum of $ 100,000, including JP Morgan, Credit Suisse, Deutsche Bank, Morgan Stanley, Citigroup and Barclays.

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