(AP Photo/Richard Drew)
Wall Street is trying to put on a kinder, gentler face for its entry-level employees.
Several major investment banks have recently announced changes to how they intend to protect the weekend hours of their junior bankers—those freshly minted college grads known as associates or analysts who toil away doing bankers’ grunt work, tweaking spreadsheets and updating presentations.
But the challenge of changing Wall Street’s long-standing culture of brutal work hours and a pay-your-dues mentality will be steep. Success will depend entirely on how consistently the banks enforce the new policies and how much they actually invest resources and leaders’ time into the efforts.
Earlier this week, Credit Suisse announced internally that its junior-rung investment banking employees should not be in the office from 6 p.m. on Friday through 10 a.m. on Sunday unless they are working on a “live deal.” Last Friday, Bank of America Merrill Lynch recommended in a memo that its junior employees take a minimum of four weekend days off per month. These recent announcements follow Goldman Sachs’ news from October that it would require analysts not to work on Saturdays, with limited exceptions. And JPMorgan is planning to ease the load by increasing its number of junior bankers and ensuring they have at least one “protected weekend” each month. (Yes, one.)
The attempts to reduce hours—brutal as they still are—come as part of larger recent efforts by banks to add mentoring programs, improve promotion opportunities and focus on long-term career development for young bankers. These niceties, some of which have been planned or tested for more than a year, perhaps are partly a response to shifting attitudes among young college grads toward Wall Street jobs. More and more are flocking to tech companies, which have cushy benefits, hoodie dress codes and lack the image problem that banking jobs have been saddled with in the aftermath of the financial crisis.
Some banks say tech companies have not been a threat. Instead, they say, banks are reassessing their practices because the technological changes that now allow managers to bang out two-sentence emails with work orders before they hop on an overseas flight have reached a breaking point. Professional services firms like investment banks, says David Solomon, co-head of the investment banking division at Goldman Sachs, “have been going in a direction over time where we weren’t creating a sustainable experience. It was defined by too many things that were negative when there were many positives.”
Goldman now explicitly tells its junior bankers that 70 to 75 hours is an average work week, whereas it didn’t have any kind of yardstick before. In addition to adding some guidelines about hours, the bank also now assigns work differently and requires projects to be outlined in more detail. “In a world where people aren’t talking about this, the work sprawled. There’s all these inefficiencies, and so you get excessive work,” Solomon says.
But restructuring work assignments and introducing better time management skills can only go so far in getting Wall Street to change its ways. Real consequences, real accountability and real enforcement—with monetary effects—will be essential. Banks appear to be trying to do this. Bank of America is creating a new manager role that reports directly to senior management and is in charge of monitoring young bankers’ hours. JPMorgan will consider junior bankers’ hours as part of managers’ reviews, says a person close to the company.
And Solomon says Goldman Sachs has begun letting analysts provide confidential midyear reviews of senior vice presidents and managing directors. He says he himself sat down with 10 senior leaders who received negative reviews from junior bankers and told them if they didn’t change, it would materially affect their career.
Goldman Sachs is also increasing its use of data to monitor the issue. “We have reams of data that we’ve never really used,” Solomon says. “We know when people enter and leave the building, when they log on and off, and we use that data to flag outliers.” He adds, “Encouraging doesn’t work. If you don’t have a whole system of expectations, processes, accountability and metrics—if you don’t have an infrastructure to support cultural change—you won’t be successful.”
Banks will also need to make investments in hiring more staff, something several say they plan to do. Presumably, all the work that was taking place on Saturdays still needs to get done. Simply shifting weekend hours to more all-nighters during the week, after all, doesn’t really improve much for anyone.
JPMorgan plans to increase its number of young staffers by 10 percent. Goldman Sachs is increasing its 2014 analyst class by 14 percent, in part due to business growth, and in part to address employees’ workload. A Bank of America memo outlining the company’s changes for young bankers said that part of its strategy is to increase its roster of junior bankers as well.
A Credit Suisse spokesperson, meanwhile, said the bank does not currently have plans to add to its analyst headcount to address this issue. It expects both senior and junior bankers to work more intelligently and efficiently during the week.
If that’s the case then it will be critical for Credit Suisse, as well as the rest of these banks, to invest plenty of resources in getting senior bankers to adjust to this new reality. Protecting a handful of weekend days off might seem like basic management (or common sense) to most of us. But in Wall Street’s pressure-cooker world, it’s going to take a lot—a lot of role models, a lot of culture change and a lot of real consequences with teeth—to make senior bankers stop and think before they dump an assignment on a kid’s desk Friday night and expect it finished by day break in London.
Lest any Wall Street old-timers get too concerned that banks are going soft these days, keep in mind that several of these banks still expect workers to check and answer e-mail regularly on their few days “off.” Changing the rules is one thing. Changing the culture will be much harder.
Jena McGregor is a columnist for On Leadership.
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