Goldman Sachs just promoted its first round of 'power 22 year-olds'
It has happened as promised. Last year, Goldman Sachs said it would be promoting its analysts to associates after two years instead of three. True to its word, it's recently done just that.
Goldman's latest associate one class is filled with young bankers who joined the bank just over two years ago. They include the likes of Alex Odagiu, who arrived in the London M&A natural resources team in July 2014 after graduating from the UK's University of St. Andrews, and Martin Daberkow, who joined Goldman's Frankfurt-based coverage team from the University of Mannheim on the same date. Goldman has even been fast-tracking analysts who joined from other banks: Simon Pellas has just been promoted to associate at the firm after working at Goldman for a year and Deutsche Bank for a year. Pellas joined from the London School of Economics in July 2014.
All of Goldman's new associates are aged approximately 22. All have been promoted one year earlier than was traditionally the case. We understand that Goldman promotes most of its associates in January, however.
When Goldman announced the truncation of its associate programme last year, David Solomon, co-head of the investment bank, said the intention was to make the role of junior bankers more appealing. Goldman's new power 22 year-olds would be able to explore other teams within the bank during their early associate year, said Solomon. The implication was also that they'd be paid more. - Goldman pays its associates median salaries of £73k ($95k) according to recruiters, whereas Goldman analysts are paid median salaries of £50k.
Goldman Sachs isn't the only bank to promote its analysts to associates after two years. - UBS and Citigroup do much the same. Morgan Stanley, however, still promotes on a traditional three year cycle.
The speed promotions have been criticized by some recruiters, who say that analysts promoted to associate after two years miss out on valuable modelling experience and are less employable later on.
Richard Hoar, a director at recruitment firm Goodman Masson, said this isn't an issue though: "You learn most of what you need to know in years one and two as an analyst," he says. "Of course this people will be employable later," he adds, "They're at Goldman."