Goldman Sachs cannot afford to lose its young investment bankers, so the multinational investment banking firm is giving them what they want: increased salaries and Saturdays off.
According to The New York Times, Goldman Sachs wants to retain its young investment bankers longer, so it is now working on a couple of organizational changes that could lure these bankers to extend their stay longer.
On Thursday, the company announced a three-part initiative to ensure that the young bankers will stay for more than two years under its care, since usually this is the time frame for analysts to exit Goldman for private equity, hedge funds or the corporate world.
Goldman's investment-banking division co-head David Solomon said in an interview, "We hire a lot of young people. 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."
Per The Wall Street Journal, Goldman Sachs' move is the biggest sign that banks are now more receptive to making significant changes to accommodate the millennial generations' wants and needs.
Executive-search firm Boyden head of global financial-services Jeanne Branthover opined, "This generation is different. They want and are serious about having a work-life balance. Most are saying 'I know this looks good on a résumé, so I'll do this for two years. But I'm using this to go somewhere else."
It's not only Goldman that is hearing out millennials since according to WSJ other banks are also hearing out the grievances of their young employees. Proof to this is the lighter workloads of junior bankers.
Solomon was quoted to have said, "We're really trying to develop people for a longer period of time than two years because, candidly, it takes more than two years to figure out [wether banking is the right career path for them]."
He also added according to Bloomberg, "By getting people on the track of becoming an associate, we're basically just matching what's going on in the world with other opportunities that are out there."
Each year, Goldman Sachs hires approximately 2,000 new analysts and provides them an annual salary of $85,000. The figure does not include bonuses. When they turn to associates, the pay they receive is significantly higher.
Goldman now says that the changes will really help young investment bankers see their career prospects more clearly. Solomon even revealed that the company will talk to first-year analysts to hear out their insights and provide promotions that would keep them from being lured by other private-equity firms and technology companies.
Solomon quipped, "We're setting up a process that will force us to recruit them at the same time they're being recruited."