Opinions expressed by Entrepreneur contributors are their own.
Top global investment banks are battling to keep quality talent in a tight labor market, with some interns getting a paycheck of $16,000 a month. A nationwide labor shortage continues to leave industries scrambling for quality workers, with the finance sector being hit particularly hard as it simultaneously faces exceptionally high turnover.
The grueling hours and demanding schedules account for widespread dissatisfaction among junior bankers who beg to work only 80 hours a week.
As top firms press on to maintain a steady pipeline of sharp talent, compensation skyrockets to new heights. In the past year alone, intern pay increased by 37.2% at top global investment banks, with some making the equivalent of $200,000 a year.
But it’s not just neighboring banks that Wall Street has to fight off for talent. The traditional, suit-and-tie banking firms now have to compete with more modern, flexible tech companies that offer an alternative to Wall Street’s notorious 100-hour work week.
Related: Apple Makes Major Moves to Combat Labor Shortage
For decades, Wall Street has been the epicenter for bright and eager graduates to start and advance their careers in the finance industry. Now, with fierce competition and flexible workplace alternatives, the hustle of FiDi doesn’t seem as glamorous to fresh talent who might prefer work from home options or – dare I say – the West Coast.
In the past two years, Silicon Valley has become a growing and viable competitor for new talent, with more than half of Glassdoor’s highest-paying internships being at tech companies in the California hub.
And yet, despite the competition and changing workplace norms, Wall Street still lures grads hungry to kickstart their careers. Goldman Sachs received a record number of applications for its summer internship program this year, a substantial 27% increase from last year. The surge could be in part due to the pay hike in entry level positions, but applications flooded in droves nonetheless.
Still, the question isn’t so much whether talent will stay for the summer or not, but if candidates are in it for the long haul. Although Goldman saw a record influx of applications, its employees continue to report on a toxic and unsustainable work culture – with some naming “bullying” and abuse as reasons for quitting.
Only time will tell, but if Wall Street wants to really compete for top talent, it might take more than a generous paycheck in the long run.
Related: Labor Shortage? Depends on Who You Ask.