Are any ER juniors actually happy?
I swear I speak to people at my shop and 90% of the time, the conversation devolves into some form of expression of discontent/disenchantment. Maybe I'm projecting but it certainly doesn't feel like many of the juniors around me want to be here for the long haul.
Offering my $0.02, I agree that a majority of the juniors in equity research don't see themselves in the seat in the long term. It's important to know this isn't an established phenomena, but is something that seems to be exacerbating what was previously known about the turnover rate in research (~25-30% a year). At it's core, research is a glorified sales position. Let us be honest, if you aren't marketing and selling your research to the buyside while also providing management to the buyside you're pretty much useless. On top of this, I believe the post-MiFID research role has stripped much of the allure of doing research.
I'll also say that people are starting to realize that the L/S, LO's of the world aren't the "dream role" as once thought of (I found myself in this camp recently). No matter what, earnings are earnings, money continues to flood towards passive vs active (although recent data shows LP's are pouring money into GP's but that's for a discussion at a later time), and the natural stress of research just doesn't seem to be worth it to many.
Lastly, older analysts continue to work like it's the early-2000's, and seeing how hard these people work vs how little they seem to have a normal life outside of ER just does not seem like the salary and title is worth it. Again, just my $0.02.
In a strictly literal sense, yes, some juniors in ER are happy.
There are some cushy seats out there. Teams that work 7:30-5, with no weekends and no earnings nights past 10pm ever. If you factor in WFH here, you get jobs that are incrementally more taxing than your typical 9-5 for over twice the pay. These people often do seem quite happy, but they’re not really after IB-type roles, they’ve got a different end game. You’ll see these working for lower-performing analysts, often at MMs/super regionals.
The ambitious are, more often than not, in a “get in to get out” mindset here. Truthfully, the pay for juniors on the sell side is not commensurate with the hours and commitment expected. After two years, I found that I wasn’t learning anything new, my pay wasn’t scaling at the rate I would hope, and it felt like “purgatory until coverage.” I didn’t feel as if I was moving my career forward, but my hours weren’t “chill” enough that I was able to coast. I was neither here nor there, and suspect many disillusioned ER juniors feel similar.
Even since lateraling to IB, I feel like I’m putting in 10% more labor power for 50% more upside.
I'm in one of those seats, roughly. Days are usually 7/7:30-5:30/6 or so. Weekends are really only for major events or IPOs / initiations and things like that which have very hard deadlines, and those are only a few times a year. But, I'd say I'm content more than happy. Work feels routine and repetitive, the constant earnings cycles are annoying, and it's clear with new AI tools we are getting access to just how limited a future in this position is. It's possible I'm just going thru burnout and not really utilizing my vacation times lol so probably something I need to adjust. However, what's the upside? Doubt my analyst (or many across my firm) have any reason to leave their seats, so my upward mobility is capped. Like you said, I'm quite well paid for the work I do, so moving to another job is a big leap. Lateral mobility is iffy in research just given how few openings / turnover there is (might be more specific to my firm, tho).
On the offset, I'm typing this at a bar at 2:30pm on a Friday, so can't really be complaining... Lol
That makes a lot of sense. I personally found it hard not to burn out given how repetitive the job was. The best way to describe it was like laps on a Mario Kart track…you’d go through four earnings seasons, a few annual industry events (usually at the same time each year), four pre-earnings preparations, one end of year preview, and 1-2 IPOs/initiations. I know people who have done that, like laps around the same track, for the better part of a decade.
I assume it’s more interesting when you get your own coverage, as you get to form and broadcast your own opinions, stay current on client conversations, and articulate the more cerebral “deep dive” notes. However, I sense it’s getting harder and harder to get to these spots.
My genuine view is that if your pay-to-hours ratio is high enough, you’re being treated well, you can make it to the bar at 2:30 on Fridays (lol), and your content, it’s still a good gig for a junior…probably a better deal, all things considered, than a typical 9-5. If you’re working for a “grinder,” however, as I’ve said, IB is 50% more upside for 10% more work.
FWIW my team is at a BB, always ranks in the top 3 in terms of broker votes within the firm, and we work 50-55 hr weeks. When it’s busy we crank out an occasional 70-80 hr week — but that’s def not the norm.
I’m very happy as a junior and while I want to eventually get over to the buyside — there is no rush: learning a ton and love the people I work with.
How is this possible? My analyst has a simple rule: if we don’t have something differentiated to say —> we don’t publish. This cuts down massively on busy work that ultimately adds no value.
echo this
Like IB, there’s a big difference between teams.
When I was in ER, my team would publish a note for every. single. thing. I kid you not, a company would PR a new VP of marking once, and we put out a note. It’s just an obsession with being ultra-comprehensive. Why? Because we weren’t close to II-ranked, we weren’t at a top 3 BB (or a BB that’s even particularly known for ER, for that matter), so our “competitive advantage” was hyper-comprehensiveness.
In addition to putting out the most notes, we’d also put out the longest notes. Some of our earnings recaps would be encyclopaedic. Our “to put this in context” would be a highly detailed (but not at all editorialised, mind you) 3 pages on what’s happened over the past two years for the company.
Inferrably, our hours were terrible and turnover was high. It didn’t really matter to the analyst, however, as he didn’t really need quality juniors, he just needed bodies to churn out factual information and model to the midpoint of guidance (lol again).
Ironically, I actually use my prior analyst’s research a lot in IB, precisely because the notes are strictly factual and very comprehensive, and because I can always trust that the projections are at the midpoint of guidance.
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