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Hard-up young bankers in search of new ventures

Driven to consider more lucrative careers by their appallingly low bonuses, investment bankers are opting for a radical change of direction. No, not really

Investment banking is not what it used to be. Three years after the height of the credit crisis, bankers are still as reviled as ever, and it seems there are still too many of them. Last week alone, UBS announced 3,500 redundancies, ABN Amro said it would cut up to 5,000 jobs, and it emerged that Goldman Sachs was negotiating pay cuts for some of its London staff.

So perhaps it’s not surprising that Wall Street’s latest generation of recruits are a disillusioned bunch, according to a survey published last week by headhunters Capstone Partnership.

Among the 2,000 young bankers Capstone spoke to, more than two thirds said “disappointment with compensation” meant they were thinking about leaving the industry. Bonus payments have indeed declined, according to official figures, falling to a paltry .8bn (£12.8bn) last year, from .5bn a year earlier.

It’s tempting to think that’s good news. For at least a decade, the sharpest, brightest, most entrepreneurial graduates from the world’s finest universities have been hoovered up by Wall Street and the City, lured by the adrenaline, the power, but most of all – let’s be honest – the extraordinary financial rewards.

It was one of the most obvious manifestations of the out-of-kilter, financialised, over-indebted economy that a job engineering leveraged buyouts became infinitely more attractive than a job in plain old engineering. But as Capstone’s Rik Kopelan told Bloomberg, “it’s been a rough couple of years for them. Fewer and fewer plan on making it a career, because they’re working these long hours and not getting paid as well as they were.”

Will these highly educated graduates now take a leaf out of Steve Jobs’s book and go off to start innovative new businesses, instead of spending their careers staking the public’s hard-earned savings on whopping great corporate takeovers? Well, er, yes – and no: more than half of the young bankers with itchy feet said they were considering throwing it all up and moving into … venture capital. © Guardian News & Media Limited 2011 | Use of this content is subject to our Terms & Conditions | More Feeds