The Seven-Year Curse
Are you stalling your career by staying with the same employer? If you work in the investment banking industry and have been with the same employer for seven years or more, you may find yourself un-hirable in the eyes of other top-tier firms and recruiters.
This may seem counter-intuitive. A long career history shows you a proven track record of reliability, and all those years working in the industry will save an employer a lot of valuable time and resources on training. How could all that experience be a liability?
Investment banks avoid hiring people who have worked for the same employer for so long because the cost of hiring them outweighs the short term benefit. Since promotions and bonuses are often earned from time spent in a job as much as from performance, those who have held positions the longest tend to be the ones who make the most money, and are therefore the most expensive to hire. The savings your employer makes by not having to train you can easily be eaten up by having to offer an inflated salary and guaranteed bonus to tempt you out of your current position.
Being too expensive for the job isn’t the only negative perception about long termers. One that’s almost as damaging is that staying in the same place for so long can make you seem too settled into your role. Investment banks want employees with ambition and drive, and the recruiters who are out headhunting want to know that the prospects they’re spending their valuable time pitching have the initiative to take the leap from one position to another. Appearing sedentary is a sure way to be ignored when what is being looked for is energy and ambition.
If your plan is to climb as far up the investment banking career ladder as possible, this can be an especially problematic situation. If you’re successful at your current workplace, it may seem that the smart thing to do is to keep letting that work and dedication carry you up the chain where you’ve already proven yourself and invested all those hours of your life. But the higher up the food chain you get the fewer spots there are. You could find your career path stalled, with no opportunities to advance where you are but considered too senior and expensive to be hired into the same position anywhere else.
If you’ve already shown that you have what it takes to make it in the industry and you want to keep your career prospects open, you can’t be afraid to keep your options open. A recent survey from the Red Unida team about alumni mobility found that almost 50% MBA grads moved roles within 24 months of the survey, and 80% moved within 36 months. Rather than demonstrating a fickle sense of commitment to their careers, most were working in IB or at an executive level in industry and they were on an upward trajectory. The most settled professionals with the longest tenures were those working for carry, which had a longer horizon to pay-off.
Therefore, i-banking in the middle tiers seems to reflect pharma and C-level career paths, which requires leveraging 24 to 36 month stints. Obviously appearing too mercenary and quick to abandon a job isn’t good for anyone’s reputation, you’re only hurting yourself by not considering other opportunities or being afraid to bite when one appears in front of you.
Red Unida has been designed specifically to help you discover the best next step for you – balancing the worth of internal equity against your value in the market place. We have built the site to not only show you the opportunities that are out there for you to take, but to compare the cost of living between different cities to better inform you of the benefits and downsides of choosing one job over the other.
While the security of a reliable job with an employer that you have grown to trust is never something to scoff at, it can also blind you and lead you into a false sense of security that can damage your future prospects for the sake of short term comfort. Even by just being aware of the other opportunities that are out there and staying as informed as possible about other possibilities in the job market, you are defending yourself against the time when all of your hard work and dedication could turn into a liability.
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