UK
Evil bonuses lead students astray
30 April 2008
Mervyn King has weighed in on the bonus debate. The guvnor says big payouts have encouraged too many talented people to squander their lives in banking when they could have been doing something more constructive instead.
King made his comments to the Treasury Select Committee.
According to the Telegraph, King says young people look at City compensation packages and think they “dominate almost any other type of career ... It's not a very attractive situation that such a high proportion of our talented young people naturally look at the City and think it is the only place to work in. It shouldn't be. It should be one of the places, but not the only one.”
Talented yoof confirm Merv’s fears. One Cambridge student confesses that he might think of doing a medical PhD or going into the voluntary sector were it not for the fact that he’s leaving university with a £15k overdraft and needs the cash.
“During my gap year I worked at Pizza Hut and earned £200 pounds a week. As a summer intern in an investment bank I’ll be earning £700 pounds a week. There’s no comparison,” he says.
“Put bluntly, yes, people do go into investment banking for the money,” confirms Gordon Chesterman, head of the Cambridge University Careers Service. “But we do work hard to promote a wide variety of other careers.”
Bonuses may not need to be reformed to put students off – mass redundancies should be a more effective deterrent.
However, they don’t seem to have had an impact yet. Martin Birchall, director of High Fliers Research, a company which monitors top students’ career aspirations, says a record number of students want to go into investment banking this year: “Despite all the problems in the City, it's still as desirable as ever.”
Are you overpaid? Should bonuses be reformed? Have your say below.
Untill bonuses are substantially trimmed or working practices in banks become unpleasent enough to be a detterent in themselves people will always consider a financial career.
The simple fact is few other careers pay as well, despite comparable working hours & stress. Such has been the shiftof the UK economy and such is the expense of further education for other careers (doctors, teachers etc) that it seems finance is the only option for those who wish to start a well paid career quickly.
The fact finance and the Civil Service are two of the most popular graduate job destinations says much for the inflexibility and lack of real work incentive in the modern British economy. This also contributes to the imbalance of the services industry in national employment, which accounts for the unusually harsh effect the Credit Crunch will have on the British economy.
No credit = no ready money = no services = no jobs.
Anon 30 Apr 2008
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