Investment banks are pledging to not work their juniors to death. Is it for real? A string of investment banks have sent memos and published releases committing to providing better working hours to employees, the Financial Times reports. This follows banking interns at Goldman Sachs circulating a deck that says they’re working brutal 105-hour weeks and routinely leave the office at 3am to the detriment of their mental wellbeing.

A problem that has been long in the making: In the 1980s and ‘90s, the investment banking industry was growing at a rate of 20% per annum with considerably higher margins, the author of the infamous 1994 “Too Busy” memo Brian Mullen tells the Financial Times. As margins and growth have since diminished, gaining new clients has become the priority over the individual worker, he adds. Mullen warns that too much of this crunch culture would only alienate employees.

Are SPACs to blame? The intensity of the complaints appear to be coinciding with the tech explosion in stocks in 2020 and the SPACs boom, says CNBC’s Hugh Son (watch, runtime: 5:19). This may have made things worse, but that “hazing” culture has been around for decades on Wall Street, particularly for employees in the “analyst” band looking to move up to “associate.”

The industry argues investment bankers are adequately compensated, and they are aware of the conditions before going in, a junior analyst at Morgan Stanley told the FT. Senior management’s attitude is “shut up or quit,” a former Goldman Sachs analyst said, while middle management’s approach is “we’ve all been there.” In 2021, an analyst at a US bulge bracket or middle market bank can make anywhere from USD 85k-95k per year in base salary, and up to USD 150k-200k in total compensation, while an associate can expect to make from USD 150k-120k per year, and up to USD 250k-450k in total, according to research by Mergers and Inquisitions.

Industry professionals are cynical about significant change: Peer pressure and entrenched attitudes in middle management remain challenging despite changing attitudes, an executive director at a global bank told the FT. “We are all nervous to say when we are struggling, we have occupational health programmes…if you go on to one, the bank can legally stop you coming into work,” she adds. The death of a Bank of America intern in 2013 saw a similar reaction, but a study on no-working Saturdays instituted in the aftermath found that “the policy backfired by inducing bankers to work longer during non-protected days,” they concluded.

What do banking execs recommend? More compensation: Bank of America, Jefferies Financial and Credit Suisse all raised compensation for junior employees, Bloomberg reports. Meanwhile, Barclays, Citi Group, and Goldman Sachs sent out memos detailing measures to optimize workflow to prevent junior employees working through weekends.

Others recommend educating senior management on what drives productivity: Despite an oversupply of analysts which adds a temptation to work them hard, a group of people who love working, love the organization and feel valued will produce more than employees who feel like the company can do away with them, the head of financial services workforce consulting at KPMG Mel Newton told the FT.