Goldman Sachs offers faster promotions to retain junior bankers
06 November 2015
Goldman Sachs Group Inc yesterday launched new initiatives aimed at retaining junior bankers, which would offer faster promotions and encourage mobility within the firm.
The move reportedly comes with companies across industries being hit by a wave of desertion by junior employees.
Under the new initiative, the bank has promised to speed up promotions for analysts to associates after their second year, with increased compensation.
It would also cut some amount of the drudgery that often got passed on to younger employees by their seniors. Following a two-year stint at the bank, junior bankers would, for the first time be guaranteed a rotation to another business division, the New York firm said.
''We hire a lot of young people,'' David Solomon, co-head of Goldman's investment banking division, said in an interview, according to The Wall Street Journal. ''We don't need 100% of them to decide they want to spend their whole careers at Goldman Sachs … we need a percentage of them to.''
According to Goldman Sachs, which hires around 2,000 new analysts each year, it would increase salaries for first-year analysts in the US by about 20 per cent, to $85,000 from $70,000, which would not include bonuses, according to The New York Times.
''The goal of all of it is to make sure we hire the best people available to the firm and that we retain those people,'' Solomon reportedly said. ''It all speaks to what I say at the highest level for a continued need for us to be very thoughtful about how we manage human capital, train them, provide learning experience and how we're transparent about their career trajectories and opportunities they have.''
The move comes only after two-years after the lender scrapped its analyst programme for investment bankers. According to commentators, the Wall Street firm was bringing back the programme in revised form. The idea was to retain junior bankers within the Goldman ranks, partly by speeding the path to promotions.
"We recognize this population is critical to the success of our business and contributes to the pipeline of future leaders," the bank said in a statement on Thursday.
The move followed what the bank called "a deep dive review of the junior banker experience at Goldman Sachs,'' adding it would reinstitute a version of the analyst programme and add a third associate year. It further said it would "revise the promotion timing and compensation of junior bankers."