Trading desks, renowned bastions of gender inequality, will sweeten compensation for women this year to narrow the gap with men, according to recruiting firm Options Group.
Wall Street leaders are facing heavier pressure this year to make their workplaces more attractive to women with better pay and faster promotions. That’s going to be top of mind as managers set bonuses in coming weeks, said Mike Karp, Options Group’s chief executive officer.
“If you find a great, qualified woman as a trader, she’ll win,” Karp said in an interview. “It’s about pay equality -- it’s more in the forefront this year than ever.”
The public got a snapshot of the gender disparities within banks earlier this year, when U.K. authorities forced big employers to disclose pay gaps for local staff. Units of HSBC Holdings Plc and Goldman Sachs Group Inc. said that, on average, they pay women more than 50 percent less, figures skewed by higher concentrations of men in senior roles. The situation in the financial industry is all the more conspicuous with women ascendant in Congress and the #MeToo movement rattling corporate America.
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The outlook for women contrasts with Options Group’s relatively subdued prediction for pay across the industry. Last week, compensation consultant Johnson Associates predicted that much of Wall Street will get “moderately” higher bonuses -- a major component of compensation packages. Yet, Karp estimates that for many people, total packages will be little changed or slightly lower than last year.
In in an annual report on Monday, he projected fixed-income traders will collect less on average for their work in 2018, bankers will see little change, and people handling equities get a bit more: “Fixed-income trading -2.6% Investment banking 0.3% Equities trading 3.2%.”
He also expects that more Wall Street employees will jump to new employers in 2019, especially people with expertise in equity derivatives or quant strategies, data science, machine learning and artificial intelligence. Those skills are in high demand, and banks will have to sweeten compensation packages in those operations to avoid defections.
Options Group predicts people specializing in stock derivatives will get this year’s largest raises by far -- about 9.5 percent on average -- while those in quantitative analytics earn 1.4 percent more.
Within equities, he predicts: Cash equities 2.6% Equity derivatives 9.5% Prime finance 1.7%.