Morning Coffee: Big Four graduates working 8am to 4am for £30k. Citadel Securities' CEO has the best origin story
It's a bad time to be a junior investment banker. But it's also a bad time to work for the Big Four professional services firms. They, too, are cutting jobs (Deloitte, EY); they, too, are trying to squeeze efficiencies.
In banking, though, you are at least paid a salary of £65k-£70k in London ($100k+ in New York) from the outset, plus a bonus. And in banking you do at least have the lure of earning a solid £250k+ by the time you're 30 if you're working in a front office position in M&A or capital markets.
In the Big Four it is not like this. You will earn less at the start. You will earn less after a few years. And you may work as hard as someone in banking, if not harder.
UK student website The Tab spoke to various Big Four graduates whose existence seems pretty abject. One woman, who joined the banking and capital markets scheme after a summer internship, said she was "excited", until she actually began in the role - at which point she had to pass six exams in six months alongside her day job and to work doubly hard because the company had implemented a hiring freeze. "I wound up with five or six clients’ year ends back to back," she said. "I’d get into work at 8AM and leave at 4AM...you're literally working the whole of that [20-hour] day."
As in banking, it's impossible to sustain a relationship in the early years of a Big Four career. And, as in banking, you're called at 3AM by managers asking for help. But in banking the pay can be transformational and in the Big Four it is not. The Big Four banking and capital markets team graduate told the Tab she started on £28k per year, which rose to £36.5k a year three years later.
“As an hourly rate, it’s below minimum wage and you do start to question, ‘is this really worth it’?” she said. “I realized that my mental health is no longer worth compromising for a job.”
Other teams at the Big Four may not be as extreme but they don't sound great either. After competing to get onto the Big Four graduate programs - which are also oversubscribed - successful students describe being hit with a barrage of exams alongside a grueling workload. "With your exams, you basically wave goodbye to your evenings and weekends," said one, adding that things get worse and not better as the amount of work increases after you're qualified.
Separately, no one knows how much Citadel Securities' CEO Peng Zhao earns per hour, but it's considerably more than minimum wage. Zhao, however, has his own experience of grubbing around in the dirt.
Bloomberg reports that Zhao's life pivoted on his passing of a math Olympiad aged 14. However, it nearly didn't happen - having received a ticket to enter the Olympiad while he was studying at nondescript school in Beijing, Zhao promptly lost it again. He and his father then spent a day and night sifting through the neighborhood rubbish dump and looking for the lost ticket. 14 -year old Zhao wasn't that bothered, but his father was insistent. They found it. Younger Zhao entered and passed the exam and went on to study at Peking University and then Berkeley. He was discovered by Ken Griffin, and now look.
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Goldman Sachs' former London office has been given a makeover. (BDonline)
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