eFinancialCareers

A new study confirms what we have long thought to be the case: Goldman Sachs pays a lot more than anywhere else. But this may only apply at the very top.

Bloomberg today suggests that the average employee at Goldman will receive a bonus of $397,707 (£209,654) this year, $187,000 more than their counterparts at Lehman Brothers and more than twice as much as bankers at the likes of Morgan Stanley and Merrill Lynch.

Unfortunately, however, it appears that Goldman’s benevolence isn’t equally extended to employees throughout the firm. One former employee turned headhunter tells us the bulk of the bonus pool is reserved for managing directors and partners, who receive around 40% of the total. He says the remainder of the firm’s staff are paid slightly more than the industry average, but nowhere near double.

“For associates, vice presidents and executive directors pay is roughly comparable,” he says. “You only start to see the really big payouts when you make managing director or partner.”

This was confirmed by headhunters in London. “It’s crazy to say that associates, vice presidents and directors at Goldman are paid twice as much as anyone else,” says one. “At vice president level they pay more than most other banks, but not much more than 10% more – Morgan Stanley and Merrill paid roughly the same last year.”

“It’s a gross generalisation,” said another. Both declined to be named.

Bloomberg arrived at its figures by looking at the total proportion of revenues banks have paid out in compensation over the past five years. They then estimated revenues for this fiscal year and extrapolated total compensation on that basis. Bonuses were assumed at 60 per cent of the compensation total.

Average predicted salaries and bonuses

Goldman Sachs: Bonus: $397,707; Salary: $261,239

Morgan Stanley: Bonus: $154,556; Salary: $103,038

Merrill Lynch: Bonus: $174,683; Salary: $116,456

Lehman Brothers: Bonus: $210,696; Salary: $140,464

Bear Stearns: Bonus: $203,077; Salary: $135,385

Source: Bloomberg

Does Goldman pay hugely better than anywhere else? Let us know what you think.