Goldman Sachs wants to bury the hatchet with its base.
The Wall Street giant, which has historically laid off around 5% of its workforce per year to shake up lagging bankers, plans to dramatically reduce that number this year as it faces a talent shortage across the country. sector, The Post learned.
With seasoned rainmakers and junior traders in record numbers, Goldman – led by part-time DJ David Solomon – is keeping a close eye on what the bank calls “involuntary time off” – the lingo of a banker who resigns after earned an annual bonus, a source with knowledge told The Post.
âThey expect a number of involuntary leaves,â the source said. “They have a whole monitoring system based on historical data, performance rankings and departures.”
In addition to the 5 percent that is eliminated, banks generally expect an additional 5 percent of employees to quit after receiving a bonus. But this year, human resources departments at large companies are asking managers to start preparing for a “big resignation” of perhaps 10 percent of junior employees in good standing, sources add.
They add that human resources departments are also warning managers to prepare “contingency plans” for workers to leave en masse after pocketing their bonuses in January and February.
âAre the banks worried? Yes. Will the outings continue? Yes. “Paul Webster, director of recruiting firm Page Executive, told The Post.” Every good HR manager tells their teams to expect this. ”
Webster adds that bankers are already approaching him for new job opportunities for the coming year. And this year, almost all major companies are on high alert.
As The Post previously reported, bonuses on Wall Street are set to hit record highs as financial giants like Goldman Sachs and JPMorgan grapple with a dire shortage of bankers, even as demand for transactions continues to rise.
After winning big pay hikes this year, Wall Street financiers can now expect a double-digit increase in year-end bonuses – an unprecedented jump since before the Great Recession, recent data shows from compensation consulting firm Johnson Associates.
With a historic wave of mergers, IPOs, spin-offs and other big strategic deals continuing to pour in, bonuses for investment bankers will see the biggest jump, rising from 30 to 35 % of their bonuses from 2020, according to the company.
Banks don’t just raise wages, they also make concessions to the lifestyle of employees. Recruiters told The Post that Goldman Sachs and JPMorgan will set expectations for people to enter the office. But they’ll be willing to work with people they really want to keep or hire.
Not everyone on Wall Street predicts disaster. An insider concedes there could be more departures than usual, but believes the big pay increases companies have made over the past year will help retain some junior employees.
He adds that for most young workers, the cost of living in cities like New York means they’ll have to stick with their day-to-day jobs.
âPeople are getting raises, but it’s not like analysts are getting ‘fuck you’ money,â he told The Post. “Will we see more resignations than usual?” Probably. But that won’t be enough to put a business at risk.
A spokesperson for Goldman Sachs declined to comment.