It’s set to be a bumper year for Wall Street pay packets, with investment banker salary being among the best.
According to boutique compensation consulting firm Johnson Associates, year-end incentive payments on Wall Street are expected to increase broadly across most financial services industry sectors this year, marking the first significant jump in remuneration since 2013.
investment banker Salary Big Winners, As Incentives For Industry Highest Since 2013
The Johnson Associates third quarter compensation analysis shows overall year-end incentives, which include cash bonuses and equity awards, will be 5% to 10% higher across the board on average this year compared to last year's total.
Of the ten job brackets considered, investment banker salary is set to receive the largest rise with an estimated percentage change of 15% to 20%. Private equity professionals are in line to receive 10% to 15% larger bonuses compared with last year.
However, not all of Wall Street's employees are inline for a double-digit pay hike this year. Equity sales & trading employees are set for an average pay decrease of between 0% and -5%. Meanwhile, fixed income traders may see a 5% to 10% decline in bonuses.
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“Several factors including a strong stock market and a favorable political and regulatory environment are contributing to one of Wall Street’s healthiest years recently. As a result, incentives will be up noticeably, especially in asset management and investment banking,” said Alan Johnson, managing director of Johnson Associates.
Johnson Associates' figures are far more optimistic than those displayed in a report from New York state Comptroller Thomas DiNapoli, which claimed that Wall Street compensation is on track to rise 3.8% this year. This figure suggests that the average bonus of $138,210 could rise to $143,462 for 2017 according to numbers compiled by CNBC. The average salary fell to $375,300 in 2016, a decline of 3% extending the decline of 19% that salaries have experienced since 2007.
Pay may be coming under pressure for some Wall Street employees, but if workers are tired of seeing their pay packets cut, Europe will welcome them with open arms. Last week Bloomberg reported that, to poach the best employees from Wall Street, European banks are offering investment banker salary packages of as much as 30% higher and guaranteed bonuses in some cases.