“…After making record profits, Wall Street giant Goldman Sachs Group Inc. reported that it will pay its workers an average of $622,000 this year.
That's more than three times the average salary of a
Wow?! As a former Wall Street employee I just can’t comprehend why Goldman employees should make 12x a high school teacher. It’s too bad wages weren’t based on positive impact to society. How many of the deals these firms orchestrate are actually accretive in the med/long term (for shareholders, not the CEO and bankers that is)? And despite the increasingly commoditized nature of M&A deals and proliferation of M&A shops the lucrative 7% commission remains…
I was surprised with the B-School Prof’s justification of the excessive income. He said this despite knowing he’s probably smarter than a majority of the people at Goldman yet makes 1/5th what they do.
“…While the salaries on Wall Street can be outsized, they reflect risk that few other professions face, said S.P. Kothari, a professor at MIT's Sloan School of Management. Traders and investment bankers constantly have to meet the bottom line: One year they can make $600,000, the next year, lose their jobs…”
What kind of risk is there to cashing in on $600K in one year (a cool $30K/year return in safe investments)? How about being laid off from the most prestigious financial firm in the world? Not exactly a CLM (career limiting move).
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