Big 3 RX 2021 Comp (A&M, Alix, FTI)
With RX being slower right now, what were people's bonuses and all in comp for 2021? How many hours were you billing? Are you enjoying the slowdown or hoping to get some more experience in? Looking specifically for AN1/2 and AS1 if possible. Obviously more catered towards A&M and FTI since they have undergrad recruiting. Thanks!
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At one of the Big 3, and bonuses have not been disclosed yet. I'll update when they are.
What is the base and bonus at these three firms for analyst level?
A&M is typically 80-90k base (COL city determines it), bonus varies from 75-125% of base. Looking at 140-180k all in 1st year.
Alix doesn't hire undergrad, FTI I would assume is lower than ours by a fair amount. (Just a guess: 100-120k 1st year).
Yikes, my TC is slightly above that as a senior consultant at FTI. I'm underpaid...
I'd say 140-160 is more the norm, at least from my assumptions. 175-180k was during COVID-19 so I feel like that skews it heavily. How does comp look as a consultant or senior consultant in the rx group at FTI?
I think it is around 100 to120 for consultant and 150 to 175 for senior consultant. Could be off since I have not been with the firm for that long but that pay discount is real for sure.
C1 at FTI in MCOL city.
80k base, 20-30% annual bonus, hard to get utilization bonus for obvious market reasons
The pay cut is real...
A&M's bonus is based off billables so an An1 at A&M RX is approximately $450/hr rate * 1600 hours (40hrs/wk for 40 weeks given slowdown in market) * 15%-20% (call it 17.5%). That would be 126k in total comp. We subtract the total billables from bonus so 126k - 80/90k base (depending on where you live and COL).
I would say that's very low compared to banking and those assumptions are based on the huge slowdown in RX but at that rate:
1. You're working 9-5pm (if even). For the most part, no one comes in MWF and Friday everyone leaves by 1/2pm if they do show up
2. You have 12 weeks (3 months) of doing basically nothing based on my calculations above.
People call RX consulting an exit opportunity because you still make good money while having periods where you're "on the beach" doing nothing. You'll be in the mid 200k range as an Assoc1. Again, it's not banking comp but you're barely working. The more you bill the more you'll make so when RX is hot you'll have a strong bonus.
How does FTI differ from that? What's your utilization and how many hours are you billing this month and/or year given the markets?
FYI Alix does hire out of undergrad for the Strategy Group (formerly Galt)
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I've always wondered - how do the RX firms justify such high comp for more entry-level roles? Do they leverage a fee-based model akin to traditional consultants or charge clients in other ways? If fee-based, I can't imagine they're charging higher rates than MBB but maybe I'm mistaken?
I work at one of the Big 3. In my location (non-US), we often charge higher rates per hour than MBB. Some cases also have a success-fee component which can increase it further.
That is interesting. I only one data point but my rate is a lot lower compared to B4 strategy arm so I'd assume it will be lower than MBB's as well
Pull a fee statement off a bankruptcy docket for any of the rx firms and you will see the rates by person. Lower levels typically bill 400-500 $/hr. You can even see their time detail to the tenth of an hour in those statements also if you’re really bored. Obviously the person doesn’t make that entire amount of the rate but comp is usually based on a % of that number. A&M and Alix have different formulas of getting there but with that base rate then obviously it can stack up very quickly.
This was super insightful. I looked at the Intelsat docket (easily found online), and it seems my thoughts on A&M comp were accurate. I noticed no one is really billing more than 40-50 hours on average, and there's only two cases of 60-65 hours of billing (at least for the month of July in that specific docket).
Have you seen people bill 60-80 hours in the first few months of the project and then trim it down to 40-50 as things slow down? If we're comparing those numbers to regular 9-5 jobs, the comp is very impressive. But, from a banking perspective it is still significantly lower. Seems like associates can see a take home pay of 225-275k which just seems a bit low (maybe my expectations are too high given the fact that we work less than bankers).
Good questions. Just as note, all dockets are easily found online so any case that you are curious about then I encourage you to pull down files from the docket to get a feel for the bankruptcy process in general. You can learn a lot about a business or risks in a specific industry/business model.
As far as your observations on hours, it’s worth noting a couple things
For your comp comment, since you use A&M as an example then we can stick with that and their structure. I think an associate bills between 500 to 600/hr. So if you bill and collect a standard 2000 hour year (40 hr/week) then that would be 550*2000= 1,100,000 in collection. If your pay range is around 25% then thats 275k. So that’s the high end of your range you mentioned. Obviously, you can do the math to toggle hrs or your pay range up or down to get a better sense of the range of potential outcomes.
Sorry for the late reply. Really appreciate your responses. I know you mentioned 2000 hours of billables is standard, but what do you think analysts at A&M are billing right now? It just seems like there's no way analysts are billing even 1600 hours much less 2000. Curious to hear your thoughts.
Also, where do you find these bankruptcy dockets? Is it on a specific website?
You can find the dockets via the various case administrator web sites like Prime Clerk or Stretto.
2000 hours isn’t necessarily standard for billables but it is the equivalent of working 40 hours/week for 50 weeks which is considered standard for most industries. Either way, I’ve heard from a few people that analyst utilization rates have been in the 60-70% range. Obviously that is a blend of everyone so there are going to be fully utilized people and some that have sat on the beach for extended periods of time.
It's kinda annoying to hear firms like A&M preach "you're expected to receive 100% of your base if not more" and then hear something like this where analysts are barely working. On the one hand it's free money for not a lot of time but on the other you're getting practically 0 experience when as an analyst you want lots of it.
Have you ever heard of people taking on side hustles or remote jobs in addition to consulting? I know it sounds absurd but if you can juggle both and want to I feel like it could be an option.
Fair point. It is worth noting that this is the slowest restructuring has been in a long time so this isn’t typical. Usually not an issue getting an analyst plenty of hours and experience so during the slow down it has been a new problem that the firms have had to deal with to get analysts the right amount of experience. Ideally, analysts can be shared across multiple practices at the firm to ensure they are busy and getting a broad base of experience before rx picks back up. All of that being said, utilization is trending in the right direction and phones have been ringing a lot more over the past month or so.
I wouldn’t recommend doing a side hustle and be careful with any employment agreement that you have. I think you’d be better served going above and beyond on non-billable projects to build relationships and get some semi decent reps to ensure that you are at the top of the list for the next staffing.
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