Last week, Goldman Sachs was in the news... again! They aren't in financial trouble, no! They aren't bringing the world down with them, no. And they aren't even involved in a scam or scandal that requires them to depose before Congress and pay a gigantic fine. It's none of the above.
In fact, Goldman was in the news last week, because it announced that for the first time in its history (and probably the history of the banking industry), that bankers had developed a soul; their conscience had woken up. The executive and senior management team at Goldman announced that going forward, they would encourage their junior bankers to take weekends off (and hopefully enjoy a better work-life balance).
I wonder why it was such a big deal though? Aren't weekends supposed to be off anyway? Isn't this what "normal" people do? Isn't this how it is supposed to be: You work Monday to Friday and then have Saturday and Sunday off? Was it news because it was Goldman that did it, or was it news because it was just so extraordinary and had never been heard of on Wall Street (and its equivalent locations around the world) before? To me, it just seemed bizarre that something which most other people take for granted in other professions would draw so much press and attention... Maybe it isn't that normal after all.
For anyone remotely familiar with the banking industry, it is notorious for not just the exorbitant compensation and pay levels, but also the inhuman hours that it subjects people to. Somehow that's all that seems to make the papers these days -- as to how much bankers get paid and not how much they work for that pay. During my first few months in the industry, one of my colleagues from the same analyst class sent around a spreadsheet to the group. In the spreadsheet, he asked us to input our annual pay, plus an estimated bonus and then the number of hours we worked during the week. This included the late nights, weekends, etc. On average, the first year analyst pulled in at least 75 hours a week in their first year, and the overall compensation for that group in 2004 was lower than what a McDonald's employee was getting paid. Anyone want to change their perceptions about banking now?
So, do the analysts get more out of this job than just poor hours and low wages? The general answer is not really. These freshly-hired graduates, with dollar signs in their eyes and visions of grand lifestyles in their heads, are subject to ridiculous working hours and conditions, because the employers know the thought process and know they will do whatever it takes. All-nighters and work on weekends are commonplace at this level, therefore. In my early years as an analyst, I worried about the hours, but knew it would be something I would have to do if I wanted to make a career in the industry. My dad always asked me "Why are they making you work so much? Why can't this be achieved during the course of the normal working day? What is it that requires you to work so late?" (I wonder if that last question assumed that I was just up to no good!) I always brushed him off saying, "It's just banking. It's the way things work, and it is how we learn the business." Maybe I was naive; maybe I was just smitten by the money and willing to anything for it, or maybe I just didn't know any better. A few years later, a lot wiser for the wear, and I now understand my folly. Today, you can't keep me in the office past 8 p.m., which I still realize is longer than most normal jobs... but again, I got to do it!
For those few extra dollars, bankers give up a lot. I've seen the really driven ones give up their families, take their relationships and marriages to the brink, let themselves go and even miss out on important social events. It is not unnatural for a banker to miss a child's recital or school function, or even an important PTA meeting just because of a deal or a client that needed immediate satisfaction. I've interviewed at a number of banks and for a range of banking jobs over the years, and it is rare that I have not received a question that looked to test my commitment to the job and my willingness to give up everything else. [Read it like Dennis Hopper does when he speaks to Keanu Reeves in Speed... "Pop quiz, hotshot,") "You have to attend a friend's wedding on Saturday. You have already made your reservations and are all packed to leave on Friday evening. However, Friday afternoon you get a call from the MD saying there is a pitch for a multi-million dollar M&A deal that must be completed by Monday morning. It will require you to be in the office all weekend. What do you do?" Really, what do you do? There is only one right answer in the banking world, and you know what it is. You also know that even if your heart tells you otherwise, you have to give them the answer they want or else there are a thousand others who will just to make sure they occupy that hot seat.
On asking one of my senior bankers why it was important that the juniors work late nights and weekends often, the response I got was a bit of an eye-opener. It wasn't so that they could learn some hidden skill or develop a motivation or desire for the business. It wasn't also so that they could develop some soft skill such as patience or tolerance or juggling tasks or the ability to work hard (you can see that I'm struggling for justifications here.) What he told me was that, "That's how we were brought up in the business, and now it's your turn." Revenge? Jealousy? Paranoia? I can't even explain it, and probably will never be able to.
Either way, the announcement from Goldman was a bit of a relief. As one of the leading and most recognizable institutions on the Street, Goldman sets the bar for others to follow. Here too, I hope that by making this announcement, it is setting a bit of a trend that will alter the lifestyle of the industry and make it a better place to work in. With this trend, maybe there will be fewer instances and reports of death like the one of the analyst from Bank of America Merrill Lynch in London earlier this year. It may also reduce the high attrition rate seen in this industry, particularly at the junior levels, and increase faith in the sector which for the last several years has seen nothing but bad news.
Do I sense that this will happen immediately? No. Do I believe there will be a cultural shift right away? No. Do I think that all other banking and financial institutions will follow Goldman and make similar declarations? Hell no! This is all about an attitude; an attitude that has festered over the years and like all old habits, will die hard. On reading the news about Goldman, a senior banker smirked and said, "Ha! Goldman! Wishful thinking. If I didn't know any better, this is all buls*** publicity. Let's see how they retain their status at the top of the tables if they implement this because you sure as hell ain't going to see it elsewhere!"
Sigh! If only the broader attitude were that easy to change...