Bloomberg reports that Jefferies and Goldman Sachs led Wall Street’s largest securities firms in average compensation per employee at midyear, widening a lead over JPMorgan.
Jefferies set aside $870m in the first six months of its fiscal year, enough to pay its 3,809 employees an average of $228,407. Goldman Sachs set aside $225,789 for each of its 32,300 workers. Average pay for the 26,553 people in JPMorgan’s investment bank was $184,989, or at least 18% less than Jefferies’s and Goldman Sachs’s reported figures. It was 10% less than both in fiscal 2011.
Wall Street firms are grappling with how much to pay staff as a slump in trading and mergers pressures revenue and expenditures. Jefferies and Goldman Sachs, both based in New York, have been positioning themselves for a rebound in securities businesses while JPMorgan, which is 64 times larger than Jefferies, absorbs a $5.8bn trading loss this year in its Chief Investment Office.
'If you’re extremely large in today’s economy, chances are you’re trying to scale down or cut costs', said Jeanne Branthover, a Managing Director at Boyden Global Executive Search Ltd. 'By staying nimble, flexible and smaller, you can keep your costs down, you can hire the best because you can give them the incentives needed to be the best and stay there', she said of Jefferies.
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