Been hearing a lot of chatter on the floor about declining analyst quality the past few years. Do people actually think this is the case, or is it a myth?
My take is it could be 3 things:
1) Selection bias. The VPs and Ds complaining were the relatively high performers as analysts/associates, and therefore have relatively lofty expectations of juniors.
2) Simple human bias and a yearning for the "good old days."
3) Actual decline in analyst quality.My take as an experienced associate (ignore the username) is it's a combination of the three, but the decline in analyst quality is very real. I've observed that associates used to have the authority to demand a finished work product from analysts, and therefore could spend more time checking and thinking about what else to include in materials, making VP and D lives easier.
Nowadays, I work with average or bad analysis who pull things like lying about being jammed, disappearing for hours at a time… or some of them just plain suck at the job. I then have to spend more time actually preparing the materials, and the inefficiency goes up the chain.Have people actually observed this decline, or is this unique to me or my group?
No need for 50 pissed off analysts to reply power-tripping about how they are pushing back more, don't care about the job, etc. Interested in objective answers only.
Agreed. Very sharp and noticeable decline in quality over the last few years. Still a few gems out there who have great attitudes and do great work but the amount of brazen slacking I see these days is unbelievable at times.
Will add that there’s definitely some nostalgia and boomerism involved as well (ie it’s partially just emotional rationalization on my part) but having seen multiple analyst classes over the years there’s still a definite difference.
Also spot on about the inefficiency backing up the whole chain. Every hour the associate spends redoing the analyst’s work is an hour the associate can’t spend taking something off the VP’s plate, which continues all the way up and makes the job worse for everyone.
you can also look at the mid levels and say they are declining which is causing a decline in analyst quality due to training. When I say the mba associates I worked with are brain dead I mean it.
Agree. Many factors. We could argue the ordering of the below but in my mind the hierarchy of issues is as follows:
1) Volume - there are just a lot more analysts (and bankers in general) than there were 5, 10, or 20 years ago. This dynamic was hugely exacerbated in the last 2-3 years.
2) Life preparedness / macro trends - the average college graduate is just not as well prepared to roll up sleeves and do work today. Proliferation of colleges, majors, and grade inflation, combined with a general sentiment shift toward valuing self/time/other factors vs. building skills/network/potential has created a general workforce that doesn't have the same approach to "apprenticeship" jobs like IB as prior analyst classes. All these analysts think they're really good because they've always been told they are in school.
3) WFH - again, this is an apprenticeship job. Analysts see seniors going home at 6-7 or not coming in at all and there's both a "when the cat's away the mouse will play" element as well as just a lost opportunity to listen into important calls (which provide context to the work you're doing) or grab 5 minutes of somebody's time without sending an email.
4) Maybe I'm a boomer but the analysts are just soft now. The expectation for hours is just not what it used to be and there's no way to be as good one year in when you work 60-70 hours a week instead of 80-90 hours.
The yelling point below is valid too - you never touch a hot stove twice - but those are bygone days.
100% agree +1
I can't fully blame them, when you see every influencer, ICO gambler, streamer, youtuber, drop-shipper, and dunce with 14 braincells talking nonsensical drivel on podcasts all making hundreds of thousand to millions of dollars you get a young generation that resents the white-collar grind.
Some definitely make it and good for them, but young kids generally overlook the hundreds to thousands of hours it took many of these folks to get to where they are and focus on the end goal of making millions online and moving to LA to live the dream.
Could not disagree more on your point #4. The marginal gain in learning that you get from 60-70 hours a week to 80-90 is so minimal.
What is more important is how stressful and challenging those working hours are - are you cranking out tough analytical work for demanding senior folk under tight deadlines on live deals. The analyst that does 60-70 hours a week on that will be way ahead of the analyst working on mindless pitch deck fluff and just twiddling thumbs at desk until midnight every night.
Live deal work is the best way to learn, and, news flash, some shops you can be on a live deals and still stay under 70 hours a week and learn a lot (speaking from exp).
The framing of people valuing their personal lives more than an office job as “soft” is something else
I would say it's definitely a decline but it stems from two gating items: a decline in broader academia and workplace culture. Middle school, high school, and college have all gotten much easier over the past 2 decades given emphasis on leaving no one behind and funding being correlated to school performance. So students think they are better than they are. The second is probably more relevant: work place yelling. 20 years ago, an MD or VP could openly yell at an analyst and it wouldn't be looked down upon. If you do that in the middle of the floor today, you'd have an HR violation. In short, there ins't enough disciplining towards the middle performers/low performers to literally make them do better. Also a change in the cost of housing/cost of living has made it less luxurious to be an analyst, but I think the former two are more relevant.
20 year cultural decline but like actually yelling but maybe housing...
It's 100% a cultural change in the office that is impacting people's performance. If you were nervous to make a typo vs being confident on pushing back, the results are much different. I said housing is not as relevant but if an analyst is going back to a shit hole and sees their savings be $4 at the end of every month because of inflation + high housing, yeah they might not want to stay until 4am because the money isn't there for many many years. But as I said, I think this is not the main cause.
I would agree in some sense that analysts (in my limited experience) might be less disciplined now than before bc of changing societal standards, but if your solution to that is “let’s just start yelling at them again!” then I’d say that’s a pretty lazy and shitty approach.
Much better ways to instill discipline in someone than demeaning them publicly.
college admission isn't easier today....it's much hard than 10-20-30 years ago. especially at the elite schools.
Fact. All the smartest kids are applying to Big 4 now.
Probably true there's a decline in analyst quality just because ib is no longer the highest rated/best industry to go into coming out of college. If i was a top tier college student with a great work ethic, great attitude and was super smart, I'd much rather go into tech/swe with better wlb and higher pay. No point taking lower pay for longer hours if I have the choice between the two.
I'd say facts, and there may be some good reasons for that.
1) Lower salaries compared to other available paths that require fewer hours; or lower salaries compared to pre-2008, so less talent wants to join IB.
2) Many MDs and VPs WFH, so juniors reciprocate with less effort.
3) Lower attention span because of the constant dopamine bombardments and distractions, which impact one's quality.
4) More interest in finding "purpose" or "fulfillment" in life, so less emotional investment in a job.
5) Change of perspective on what financial freedom means (older generations were more materialistic and more dependent on IB salaries, newer generations are more frugal, so they don't feel as tied to their jobs).
6) Even the exit opportunities argument to push someone in IB sounds crazy. If you have no idea what you want to do, just focus on whatever is now hot in the economy (e.g. tech or start-ups), and once it declines (as it does now), then you move into the next hot thing. Repeat that until you become a millionaire.
Still, to defend current analysts, older generations shit on newer generations, so sometimes those claims may be highly exaggerated (proof). Many analysts are better than older generations because a lot of information and resources to prepare for IB became widely accessible, but no one seems to discuss that (maybe because of insecurity or arrogance?).
Anyway, don't forget that there are also a lot of incompetent ASOs, VPs, and MDs who were promoted only for being in the right team or a boom cycle, so their incompetence could directly affect analysts.
I think there is definitely a noticeable downward trend but I don't think it's the candidates' fault, I think it relates to the major shifts in on-the-job training. Candidate quality (at least on paper) is as strong and competitive as ever.
One example - Pre-COVID there wasn't zoom so you'd have the whole deal team huddled in an office listening in to various calls. I actually think this was really valuable because you could mute the line and the seniors/mid-levels can actively explain things as they are happening. Now, even with everyone in the office, people just work from their cubes/offices and the juniors don't really get any of that active commentary. You definitely don't retain information as well in this format and you probably aren't actively taking notes or even worse working on something else entirely.
Another example is that there is just so much less collaboration between analysts themselves and also analysts and associates/VPs. Again I think the zoom culture has discouraged sitting down with people at their desks and working through things. Now everyone pretty much goes home at 6/7pm (which don't get me wrong, I think this is a good thing), but once you go home and start working you are kind of on your own. You can't ask your associate or fellow analyst to come to your desk to work through things so if you get stuck you'll probably end up sending something up the chain that is wrong, which contributes to this cycle of mid-levels not thinking analysts are competent.
Yea, this is good. I've read a bunch of comments and want to add my 2 cents:
1. The acceptance of "WFH when you can" culture. When you have the opportunity to go home at 6, 7, 8 (and expectation), the focus is getting your work done as quickly as possible (even if quality isn't as good) rather than diligently getting work done and learning, printing out your work to check, tick and tie, etc.
2. Connected to the above, the training from the mid-level. Similarly, if a mid-level can get home at 6, they're focused on getting their work done rather than training (so that when they get home they can just do emails rather than actually work). Someone mentioned above it's tough to train when that's the difference between an 11pm night and a 2am night - totally agree, but that was the expectation. It just isn't anymore.
3. Someone mentioned dopamine hits from social media. Very true.
4. Generally less of a focus on the long term. I see fewer young folks in the office talking about climbing the ranks and what it takes and more of them looking externally (i.e. let me make what I can for now but long term I want out of the industry). As someone said, maybe there's less focus on material goods. Or maybe there's more hopelessness because of how much less affordable the "wealthy lifestyle" seems. Also may be because they see a lot of young-ish but senior folks, meaning less room for them to move up. If I'm 23 and I see a huge amount of 30-34 year olds doing well, then what room would there be for me to break in at the senior ranks? As someone said, less emotional investment in the job and less pride in one's work
5. Someone mentioned "yelling" culture. I'd put it another way, which is a huge focus on allowing analysts work life balance. That used to never be talked about. The expectation as an analyst 1 was going home at 2am on average and weekend work (typically one full day and one day with a few hours to clean up). The reciprocity was training from the mid-level / senior folks. If you're now told it's bad to keep analysts late, then how are you supposed to sit with them from 6-7pm to talk through a model and how the deal team is thinking through something? It's created a culture of just getting the work done with no training. In addition, it is very hard to express disappointment in someone's work. Not impossible, but between the increased HR-related sensitivities and 360 reviews, it generally feels like giving direct negative feedback has more downside than upside
In 2023 it’s very difficult to tell an adult that he/ she “isn’t allowed” to leave until 2am for a whopping $150k total comp.
Same reason minimum wage workers nowadays seem increasingly terrible - they simply do not get paid enough to care.
Analyst position is like the top-tier McDonalds cashier. Low skill requirements, the most BS of any position, AND get paid the least. There’s too much information accessible to buy into the nonsense.
80% boomerism 20% fact.
Too much information about the job and alternative career paths out there to make anyone give a flying fuck about being an analyst. There are 14 year old Fortnite players making more money than a lot of MDs.
Also, no one talks about the slew of complete garbage associates and VPs. These are the same hardo colleagues who think they were a stud analyst, yet when you ask their former VPs and above it’s only horror stories.
Surprised nobody has mentioned anything about diversity recruiting yet. Banks have made a marked effort to create certain gender/racial quotas for intern classes which feeds into the analyst program. Hard to dictate a 50/50 gender split when the applicant pool may be as high as 80% men without sacrificing quality of final class. Similarly hard on the racial quota side for obvious reasons
Edit: I request that individuals who have participated in diversity programs refrain from voting on this post
Based. Lol everyone tryna avoid the elephant in the room to remain politically correct.
There's a good reason people don't talk about it: it's not the main issue. Don't get me wrong, I'm not here to dodge the truth about diversity hiring. Any time you hire using criteria that is unrelated to the job, you lose some quality. That's true by definition.
But that's not the story here. Diversity hiring is older than this story. There is more recently a bigger issue about (i) generational change, softness etc that's affecting every professional service firm and (ii) and additional hit to IB which is talent drain to other industries.
You watch too much Jordan Peterson. That line of thinking only holds when you scale up the number of people you're talking about and the technical skills required to succeed in a job.
Yes, when you observe the distribution of "skill" across a large population set you're correct. Mathematically, you're lowering the quality of hires when advocating for something like 50% DEI quotas for all engineers. But that's primarily a function of 1) The sheer number of engineer slots in the job force and 2) The technical competence required to be considered a "top tier" engineer.
In an industry like IB, there are far fewer Analyst spots than in the engineer example above and the technical skills required (you'll realize this soon enough, AN1) to be a competent analyst is far below that of engineers.
Holy shit shit it breaks my heart to hear these lazy target school kid’s who simply were admitted because of the school associated with there GPA.
Firms are soon going to realize that the academic prestige associated with target schools means so much less than it did a decade ago.
Non-targets with ethic are about to push an entire generation of lazy targets into extinction.
inshallah. if HR gave me full reigns for recruiting i could create the next Centerview. team would look a lot like the one from Dodgeball
I'm kinda shocked that no one has mentioned the COVID impacted college experience for analysts that joined these last few years. I think that's also a massive driver of the lack of interest in working. Can you imagine going two years of not having to leave your dorm room outside of eating, laundry, and social reasons? All your tests and quizzes are easy because you are in a dorm and have access to the internet, etc.. they essentially had pivotal years where you learn to be fully self sufficient and actually learn / hone in on their interests stripped away because they could just skate by doing the bare minimum (and most of them chose to)
Fact. Sadly.
Lots of analysts now actively playing smoke and mirrors to try to pull the wool over the staffers eyes. Laziness is a key problem.
Lots of senior analysts nowadays, even in a BB, can't do things I'd expect an analyst 2 to be able to do.
Diversity hiring has also impacted the junior pool. It's no longer a meritocracy.
I forever see associates having to step down and do analyst work. If I have an analyst help me directly then I spend a lot of my time pointing out basic mistakes I'd expect an intern to pick up.
Really a lot of ways to go about this, and I agree with what most said above.
I'd really boil it down to two points, I'd say the quality of analysts has probably dropped (for numerous reasons) but at the same time the job has become much more demanding (not to mention outside of work has become much more difficult). To quote The Wire:
Cutty: Game done changed.
Slim Charles: Game's the same, just got more fierce.
I think we see this is a lot of different fields. Take the military, they had to lower standards to get people in because most people now are overweight and untrained, while someone could also say that being a solider is probably more demanding now than it has every been. Take advertising, I now Mad Men is fictional but some truth, really advertising use to not be that difficult of a job relativity, now it probably a much more difficult job in creating pitches (that's why most commercials now are bad imo).
Regarding analyst, I think we kind of live in a time now where people are a little pampered, meaning, when they take jobs that want the good but don't necessary want the bad. Specifically in banking, that creates a culture where people want the paycheck and bonus, but don't want the crazy hours.
"Joe had his time, and Marlo put an end to that. Then Marlo had his time, short as it was, and the police put an end to that. And now, muthafucka, it's OUR time. Mines and yours. But instead of just shuttin' up and kicking in, you gonna stand there cryin' this back in the day shit. There ain't no nostalgia to this shit here! It's just the street, and the game, and what happen here today"
I agree that it's a two way street. The times of endless grinding in an office are probably done for (Joe), but the cushy/protected workplace that is revered today (limited hours, no stern reprimands for fucking up, 10% raises for literally doing your base job description) won't stay around forever (Marlo).
If we hit a big enough economic downturn or socio-cultural shit really hits the fan, people across all generations may just wake up and realize that your job is not going to give you every single thing necessary for a perfectly cushy life with zero hard times. Can't always have your cake and eat it too.
Always makes me think about the "Hard times create strong men. Strong men create good times. Good times create weak men. Weak men create bad times". We've had an unprecedented run of prosperity and (relative) peace, and I think a lot of people in America are unfortunately "weak" right now (and not just younger generations, although I'd say it's more pronounced).
The strong men / weak men quote is the stupidest thing I see keep popping up on the internet. Does anyone really think the average millennial or Gen Z has it easier than Boomers / Gen X? The fabric of this entire country was literally built to cater to Boomers post-WW2.
You could buy a house, car, and pay for college while working 40 hours a week with no college degree back then; Millennials and Gen Z are lived through 9/11, 2008, COVID, and are currently experiencing the worst COL and housing crisis we have ever seen.
Pretending that current generations have it easier and that is making people "soft" is just stupid and empirically false.
There are plenty of societies that have been perpetually going through hard times without this mythical generation of "strong men" appearing to course-correct. Russia / USSR, North Korea, Argentina, Venezuela, many countries in Africa. China pre-1978 open door policy was in a perpetual state of "hard times." When Ireland was hit by the potato famine, it didn't create a generation of "strong men" who then led the country to prosperity - half the country either died off or left, and the country's modern population is still down from pre-famine numbers (5M in 2023 compared to 8.5M in 1844). Haiti is still recovering from the 2010 earthquake.
Even thinking about this in an American context: the Greatest Generation were the strong men who created the good times, which led to Boomers who were weak men who created hard times? So it's then Generation X / Millennials who are the strong men who created good times (2000 - 2020)?
I wrote more than I meant to but I see that quote all the time and it drives me insane.
Fantastic comments on here so far, 100% agree that it's a combination of factors - yes banks overhired in 2021, but Covid/wfh is as much to blame if not more so.
Speaking personally for myself - whilst the antiquated concept of face-time/hanging around in the office until midnight has gone away which is a good thing in many respects, it also sucks for analysts long-term. Of course if you'd asked me as an analyst if I could start regularly going home at 7/8pm most nights I'd have been ecstatic - however in the long-term I think it would have impacted my long-term prospects and also enthusiasm for the industry.
As a person in your early 20s, IB pre-Covid was such an absolutely fantastic learning experience - not only did you learn about excel and models, but more importantly you got exposure (if only peripheral) to very senior MDs and C-suite members of clients. Also when you work on a deal you got to see every aspect of a transaction - from the extremely mundane but still useful to learn (creating a data room and scheduling DD calls), to the very exciting (your MD rushing out of his office to your VP's desk the second that binding bids come in on a sell side mandate, finding out your client has won on a buyside deal). The problem now is so much of that learning was by osmosis - i.e. just sitting with the team and picking up things over time. Unfortunately so much of that has now gone with wfh, for all its benefits.
Equally - enthusiasm for the job. Of course working late in the office sucked - but over time you really develop a camaraderie with other analysts, associates and even your VP (assuming they're decent human beings). I remember so many times being stuck in the office till 1am with fellow analysts or an associate - whilst you were exhausted, as an early 20-something you also felt like you were "in the trenches" together, cracking jokes full of dry humour. Maybe I was just naive and/or a bit of a nerd back then, but working on a live deal actually felt pretty exciting - because it was your team slogging it out to get to the finish line. And occasionally as an analyst you'd go out with other juniors and get blasted in a bar at midnight just to let off some steam.
I think now however the job seems much more mundane - yes you have better worklife balance, but you are really just processing information most of the time in a relatively solitary environment. And as others have said, you don't get that osmosis - both because the analysts would rather just watch Netflix at home during their downtime than ask questions, and also the associates/VPs want to just finish without having to go to the hassle of specifically setting up a Teams/Zoom call to take a newbie analyst through certain concepts (previously this was all done by sitting with someone at their desk).
That aside, I agree with the cost of living point - given how much house prices have gone up over the last few years, slaving away to save up $100k doesn't sound anywhere near as exciting as it did when I was an analyst 10 years ago. I realize that's a very privileged position to take compared to most people, but nonetheless it is a fair point. I think this is further reinforced when analysts look up at associates/VPs and see that whilst they have very comfortable middle-class lives, very few of them are "ballers" - in reality they're slaving away to own a nice suburban house, maybe a nice-ish car, and put 2 kids into private school. But they're not on their way to making millions of $$ like in the 2000s. I think during 2020-21 this was probably further exacerbated by social media + the crypto boom, whereby influencers and crypto bros were seemingly making millions overnight with little effort (of course there's an enormous survivorship bias here but many young kids won't necessarily realize that).
So that's my 2 cents (really just a rehash of what others have said already, tinged with my own personal experience). About wfh/the post-Covid work environment... I'm still unsure about it. Yes it gives me a lot more freedom/worklife balance (now in PE in my early 30s), however I feel like the IB/finance environment of pre-Covid may be gone forever. And whilst there's lots of positives about that (reduction in pointless facetime for instance) it also means the job just isn't as interesting or as much of a learning experience as it used to be. I honestly don't know if I'd have stayed in finance long-term if I started as an analyst right now.
It's almost entirely driven by COVID and WFH imo. The other factors mentioned here might play some role but it's like 90% COVID driven. There was a complete step-change from before COVID to after that hasn't corrected itself yet.
The result is that you have a problem that has impacted multiple generations of juniors. To be sure there are still quality people who would excel regardless of circumstances, but I don't think most of these people had a chance. That's where I disagree with most of the takes in this topic - this exact same pool could have started in 2018 or whatever and they would have been about as good as any of the prior generations. Rebuilding will require a few more classes. You need people in the office doing real internships, those people need to stick around and train the generation after them.
Competition from tech, zoomers being "soft", diversity, whatever else you want to throw out there may have some impact but it's nothing compared to the above.
And it's not just analysts. It's associates as well.
Such a shit take lol
It's the take of basically everyone who actually saw both sides of it lol, not exactly novel. Woah people in an apprenticeship industry start to suck when you gut their ability to learn anything what a blazing hot take
people have been whining about all of the other shit forever. Some of it probably matters, none of it matters as much as a two year hiatus on the IB learning process that had been in place for decades
"to the very exciting (your MD rushing out of his office to your VP's desk the second that binding bids come in on a sell side mandate, finding out your client has won on a buyside deal)"
lmao. banking is SO ExCitInG!
This whole ironic disinterest vibe in kids these days is very offputting. Feels like there’s no earnestness in anything at all and everything is just one big inside joke.
Analyst quality will continue to decrease as buy side firms ramp up recruiting straight out of university. All the kids who started a trading account when they were 16 and started advanced accounting and modelling at 17, who 20 years ago have gone to GS are just heading straight to HF or PE. If you're actually really smart your not going to the banks to get worked 90 hours a week for a 30 grand bonus, your going to work at HRT and get payed £500,000 first year out of uni working 60 hours at most. This just will result in the analyst classes being filled with hardos that learnt what a DCF is a week before their final round because they got told if you don't know what to do and like money, be an investment banker.
Eh but I think I’d say the same thing about first year buyside analysts as well. The people here attributing it to a generational change in attitude have it right and that fact isn’t side-stepped by the greater prevalence of UG buyside recruiting.
If your fund isn't getting a look in at the top talent just say that buddy. The idea that suddenly no one is competent on technicals or willing to work hard due to attitudes towards jobs just isn't true. The fact is that the very best students from MIT, Harvard, Oxford and Cambridge are just joining Blackstone, KKR, Bridgewater, DE Shaw, Point72, Citadel and the top prop shops. I promise you as someone who is going through recruitment now, there is a vast gap between the people that 6 months ago decided to be an investment banker because they go to semi target and their mate is applying and the top students from Harvard studying economics and maths that have wanted to work at a Hf since they were 16. What happens now is that the internet has so many resources that you can pass the majority of interviews on the sell side without having to think and guess what the result of that is. You get a load of people on the job that don't actually want to be there but passed interviews and it was their best option.......