If you’re looking for a front office finance career with a good effort/reward ratio, you probably don’t want a research job in an investment bank. Nor do you want to be a fund manager for a hedge fund. The optimum role looks like something in origination or syndication.
So says new research from real time pay benchmarking firm Emolument.com. Emolument asked a selection of front office bankers by age whether they were satisfied with their work-life balance and compared this to their total compensation (salary plus bonus). The results, shown in the charts below, are telling.
Firstly, there’s no free lunch for the highest paid people in finance. The highest paying careers – in M&A and leveraged finance – are also the most demanding. While you may earn £3.8m before tax during a 15 year M&A career, you will also be expected to work very long hours. Highly paid M&A/lev finance bankers are therefore the least satisfied with their work-life balance.
Similarly, high-earning traders and structurers are comparatively unhappy with the extent to which work dominates their lives.
By comparison, originators and syndication professionals (who bring in equity and debt capital markets deals and loans and then help distribute the resulting products to investors) are the anomaly. They’re not only very well paid, but have very chilled lives: just 22% are unsatisfied with their work life balance. The only other people who are nearly as chilled are long only asset managers – and they earn 20% less over the course of their careers.
Perversely, some of the least remunerative front office finance jobs are also the most successful. Equity researchers in investment banks earn around £1m less than M&A and leveraged finance professionals over the course of their careers, but have to work as hard. On this basis, research is to be avoided – particularly as roles are likely to be come more demanding (although may end up paying more) under MiFID II.
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