Compensation Differential NYC/London

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Does anyone have insight into the comp differential between NYC/LDN geographies both generally and among the same firms but in different offices? Particularly like big US based funds that have london offices? I know at US based BBs that the IB comp is abysmal compared to the US guys (at least for analysts and associates), So I’m wondering if that is still the case for say Blackstone, Avenue, Brigade, Marshall Wace etc. (large global funds with offices in NYC and LDN).

Comments (18)

 
  • Analyst 1 in IB - Ind
May 1, 2020 - 4:43am

Interested as well

Array
 
  • Associate 2 in HF - Other
May 1, 2020 - 1:09pm

You mean like you actually just get paid in USD and have to convert to pay all your GBP expenses lol? or they do the conversion for you and so the comp is similar.

I have also heard it varies significantly but at best the london arm is on par with NYC and at worst it’s much lower. I would think tho for large london based places like Marshall Wace, maybe the london guys would have a leg up but that seems never to be the case

 
  • Prospect in IB-M&A
May 2, 2020 - 5:09pm

"I know at US based BBs that the IB comp is abysmal compared to the US guys"

I think you're misguided. I'm an incoming intern this summer and I've researched this topic as I was myself contemplating whether to pick NY or London.

Analyst 1 compensation in NY at a BB is $85k base, c.80% bonus(i) (that is, around $150k). Analyst 1 compensation in London at a BB is £50k, c.80% bonus(ii) (that is, around £90k). In nominal terms, then, Analyst-1s in London make around $115k (a big 'cut' - of 23% - to New York numbers).

But, in real terms, $1 in London gets you the same things around $1.29 does in New York(iii). In real terms, then, Analyst-1s in London make c.$148k of New-York-value-dollars.

Now, take into account the fact that 100-hour work weeks in New York become 80-hour weeks in London, the fact that you can (and, in fact, are encouraged!) to take 3/4 weeks off in London (compared to, what, 1 week in New York?), and the fact that London is just a better and more fun place to party and go out to nice restaurants. I wonder which I'd pick?

Also don't forget that, as degrees in the UK are three, as opposed to four, years long AN2 London pay is a better comparison for AN1 pay in New York.

The same logic applies, I assume, for the funds.

(i) see extensive data on WSO
(ii) https://news.efinancialcareers.com/uk-en/277526/banking-salaries-and-bo…
(iii) https://www.numbeo.com/cost-of-living/compare_cities.jsp?country1=Unite…

(plug in £50,000 into the calculator and you'll see: "You would need around 69,418.58£ (86,787.11$) in New York, NY to maintain the same standard of life that you can have with 50,000.00£ in London")

Array
 
May 2, 2020 - 8:31pm

I think you threw in a bunch of ancillary stuff there, but the base fact remains that the pay is significantly less. I think it’s debatable as to the cost of living differences. Many of my colleagues who have moved and head hunters in london have straight up said the cost of living is roughly the same if not a little higher. just take common goods - like the price of a cocktail in a bar in Mayfair vs. Tribeca. living in zone 1 is not cheap. the points about lifestyle is true sure, but that’s not what the topic is about. and on the investing side, it’s got to be a function of the AUM and therefore NYC should have much larger payouts - the economics just wouldn’t make sense otherwise. at the top end of the spectrum I’ve been told you’re never going to make nearly as much in London, there are only so many £5m+ seats. I mean you can simply just look at the number of finance billionaires in NYC vs. London. I’m not worried about a 23% haircut as a 1st year analyst. I’m worried about a 200% haircut and capping out as a senior investment professional career wise. and as I’m sure you know, that haircut only increases. 2nd year analysts are £55k and $95k and it only continues to widen at the associate level. 3rd year associates start at $200k at the bank I worked at, and VPs in london are what £115k according to this article?

I’m all for living in london and the non-comp factors matter too. But sticking to the numbers, you haven’t said anything different. Congrats on the offer, all I can tell you is both are great but it’s a lot hard to move one way across the pond than it is the other.

 
  • Intern in IB - Ind
May 2, 2020 - 10:44pm

Yeah cost of living is lower and your dollar gets you more in London than NY, but a 35k difference your first year is a lot. And that disparity only grows to the point that the 23% difference that equates cost of living differences is significantly larger and whatever that percentage is is way higher than 23%. In terms of restaurants, both cities are filled to the brim with amazing restaurants, don't think it's fair to compare. I think the two strengths of the two cities would be the hours in London, you'll work less with more time off. But the strength of NY is not having butt-ugly girls. Women in the UK just aren't very attractive.

 
May 3, 2020 - 8:20am

Hah, decent international crowd in London. But let’s be real. It’s mostly work upon more work anyway and hardly anyone hangs in places like Mayfair, unless paid services is your vibe.

Career wise way fewer opportunities / seats in London. Even more consolidation at the good big shops. But culturally way more diversity 1 hour flight away, which is a selling point for many that care a bit less about the dollars since the good ones make bank everywhere - New York, London, Singapore, HK you name it.

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