Wall Street’s Young Bankers Are Still Mostly White and Male

Posted on September 30, 2014 by

Wall Street’s gender diversity problem isn’t confined to the top executives.

Even at the entry level, investment bank employees are overwhelmingly men, according to a report by a start-up recruiting firm.

In this year’s class of first-year bankers — known on Wall Street as analysts — 77.5 percent are male, the start-up, Vettery, found. That level was flat from 2013.

The finding sheds some light on a less-visible aspect of the gender imbalance in finance. While the paucity of women at the highest ranks of corporate America is plain to see — just under 5 percent of Fortune 500 C.E.O.’s are women — big companies generally do not release demographic information about their junior workers. The statistics still seem to hold even as women outpace men in college enrollment and the work force of the United States becomes increasingly diverse.

Vettery, which seeks to use technology for recruiting in fields like private equity, said it collected its data from its network of about 100,000 financial workers who have signed up for the site. It also used regulatory filings and social sites like LinkedIn to extrapolate the information. The company did not verify its findings with the banks.

Vettery also collected information about the ethnic diversity of young bankers and the schools they came from. Over all, 65 percent of this year’s class of analysts are white, while 29 percent are Asian. Just 6 percent of the analysts are black or Hispanic, Vettery found.

Smaller banks fared modestly better in terms of diversity. Among the biggest investment banks — the so-called bulge bracket — 64 percent of the class is white, compared with 59 percent at the boutique investment banks, according to Vettery.

Ivy league campuses where Wall Street firms heavily recruit — including Harvard, Princeton, Yale and the University of Pennsylvania — were among the top 10 schools by number of graduates going to Wall Street this year. But a major public university, the University of Michigan, experienced a 55 percent increase in the number of its graduates taking jobs as analysts compared with last year, rising to the No. 5 spot from No. 14, according to Vettery.

And Penn, which was the No. 1 school this year and last, showed a 14 percent decline in the number of graduates going to Wall Street compared with last year.

New York University, the No. 2 school for two years running, experienced a 17 percent increase in graduates entering finance. Georgetown University rose in the ranks to No. 3 this year compared with No. 7 last year, with a 32 percent increase in graduates becoming analysts. Yale also showed a big increase, ranking No. 10 this year compared with No. 17 last year.

Vettery’s findings on ethnic diversity, broken down by bank, were challenged by some of the banks cited.

Among the big investment banks, Deutsche Bank had the highest percentage of white first-year analysts, at 70 percent, the start-up found.

A spokeswoman for Deutsche Bank, Amanda Williams, said in a statement that the bank was “committed to recruiting diverse talent.” She added that the findings of the survey were “inaccurate and do not reflect the true diversity of our 2014 analyst class,” though she declined to disclose a more accurate figure.

Barclays was also found to have a largely white class, at 69 percent, though that bank also challenged the finding. Bank of America and Credit Suisse both had 66 percent, the start-up found.

Mark Lane, a spokesman for Barclays, said in a statement that the data was “inaccurate and fails to reflect the diversity of our incoming class.” He also declined to provide the precise number.

At Goldman Sachs, 56 percent of the first-years are white, the lowest percentage among the big banks, according to Vettery. The highest percentage of black or Hispanic first-year analysts is at JPMorgan Chase, at 13 percent of the class. At Morgan Stanley, 12 percent of the class is black or Hispanic.

A spokesman for JPMorgan, Brian Marchiony, said in a statement: “We put a tremendous focus on diversity at the firm, but we are mindful that more still needs to be done.”

Representatives of Goldman, Morgan Stanley, Credit Suisse and Bank of America declined to comment.

Vettery’s findings on gender diversity showed a lack of progress in hiring more female workers, said Sallie L. Krawcheck, a former executive of Bank of America and Citigroup who now runs a women’s network called Ellevate.

The numbers “are not very different from when I started,” as an analyst at Salomon Brothers in 1987, Ms. Krawcheck said.

“It can be necessary but not sufficient to have a strong pipeline in order to increase the numbers at the mid and senior level,” she said. “If these numbers are correct, there hasn’t been a great deal of progress on the pipeline at the entry level.”

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