I was asked to comment on the results of a recent Ignites (A Financial Times Service) poll on 2013 compensation. Overall, respondents were optimistic about their pay prospects, but hardly euphoric. 36% believed that their pay would be slightly higher this year, while 10% believed that their pay would be much higher. In contrast, only 11% of respondents believed that their pay would go down, and 4% felt that their pay would be much lower.
The results are not surprising, given how the markets have been doing this year. Presumably, anyone paid on commission or with bonuses tied to firm performance would expect their pay to increase. That only makes sense. But what is more encouraging to me is that the optimism, while there, seems guarded.
I think that this shows the dose of realism that the last financial meltdown left on the industry, and is positive in that hopefully it points to the industry not making the same types of mistakes in the future that it has made in the past. To quote from the article:
“Given the positive performance of equity markets this year, it is not hard to see why nearly 50% of respondents believe their employers will be more generous with pay come bonus time, says Andrew Klausner, founder of strategic consultancy AK Advisory Partners.
Klausner believes that today’s upbeat forecast for pay, as expressed in Tuesday’s Ignites poll, is much more sustainable when compared to the excessively cheerful outlook seen before the financial crisis.
“The magnitude of the latest crash has made everyone a little more realistic. Yes, hiring and pay have picked up, but probably at a much lower rate than previously, which is a good thing,” he says. “Wall Street has always over-hired and overpaid during good times and then slashed during bad times.””
A more stable and realistic Wall Street is good for the markets and the people that work in the industry.
