How Long Until PE Matches IB Comp Increases?
When banks increased associate pay the other year, how long did it take for PE to respond?
I just learned a first year analyst at Baird now makes the same salary as me, that stings
For reference LMM PE in Tier 1B city outside NY / CA, ~$750mm fund size
Baird associate base is now $225k too. Only gets rougher the closer you look. feelsbadman
Apparently that was wrong information and the poster changed to 200. Still nuts tho
At an UMM (fund size $6bn+) Tier 1 city sitting here at $125k base, definitely feels bad but don't think my PE firm cares and I guess ultimately most people come into PE knowing you'll take a hair cut but hopefully by the VP/Principal levels you make up for it (if you make it there)
1) Not sure how much total comp will change for banks. I'd wager that even with the salary bump overall comp only goes up $5-10k, though having a higher fixed pay than discretionary bonus is a win nevertheless
2) Analysts are still coming to PE regardless of these pay raises (though will probably take 1-2 years to see if there is actually any tangible impact). Case in point, I'll probably make ~$250k all-in as a 1st year associate but if I stayed on at my EB I would've cleared $300k and even knowing that I'll still pick PE 10/10 times
Would you pick PE 10/10 times because it is more intellectually stimulating? I've heard the hours are not as good as everyone says, and sometimes worse than banking. Don't most PE associates not make it to VP level? If you take a pay cut for PE at the associate level, what makes it better than IB?
Struggling to see the allure of PE after reading all the threads about how terrible PE is and now seeing that EB associates make a good chunk more.
Work is far more interesting even if hours / pressure can be worse at times. Comp does not matter at the junior levels if you take a long term view of your career. There is a reason why people that leave banking for PE / HF almost never come back.
I’ve heard rumblings that a ~$5bn fund is moving forward wrt to pay increases for associates. News should come out soon. Hopefully it causes a chain reaction. I’m at a similar size fund. We posed the question 2 months ago to HR and it was side stepped (tastefully). Now that more banks have raised pay, we’ll ask again. Bonus is much higher in PE but agree with sentiment above, making 20k more in salary than a 1st year at Baird feels odd. Not a knock on Baird or other banks, more of a comment comparing my abilities as a 1st year analyst vs. now. I’d like to think my 2 years of banking would merit a salary more than 20k above a 1st year analyst. To answer directly, I think it’ll happen in next 3 months.
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