Goldman Sachs executives are wrestling with the question of whether they need to bump up salaries for junior investment bankers this year to match rivals on Wall Street after younger staff complained they were burnt out.
Some senior executives have argued that boosting salaries mid-year would set a “dangerous precedent” and mark a break with the bank’s “pay for performance” mantra, according to people briefed on the discussions.
Investment banks have historically avoided significant inflation in fixed salaries, which are harder to reduce in fallow periods. Instead, they tend to reward staff with bonuses that can vary dramatically from year to year depending on the performance of individuals and banks overall.