Don't people get it? IB is "gone" and so is the money

Career Opportunities & Internships Investment Banking
21

<p>I don't know anything about being a pharmacist, but meant positions right out of UG, which I don't think is enough to become a pharmacist; not to mention someone inclined in that direction would already probably be some kind of focused science major instead of a more general humanities/social sciences major. </p>

<p>Even without promotions, second and third year IB analyst compensation has historically risen faster and generally the exit opportunities are much better. Less than 15% of my analyst class stayed on to become an associate, but that doesn't mean it wasn't a worthwhile experience that led to good things for the rest of us.</p>

22

<p>
[quote]

Wow, you're a bloody idiot. We're talking about jobs RIGHT out of college -- not jobs that require jumping through a series of hoops and EXPENSIVE pharmacy school.

[/quote]

I am talking about jobs right out of college.<br>
1. There are 6 year PharmD programs that admit directly from HS. So if you want to define undergrad as Bachelor's level, you would be correct. But for all intents in purposes, I am using the definition as "first degree since high school".
2. What "series of hoops" are you referring to?
2. Pharmacy school is not expensive. Assuming you have no scholarships, a state school like Rutgers U. will cost you $70,000 over a course of 6 years for a PharmD. For me it costs me nothing because I'm in the National Guard and NJ has state tuition waiver which prohibits a public university from charging a Guardmember tuition for any degree or any number of credits.

[quote]

I don't know anything about being a pharmacist, but meant positions right out of UG, which I don't think is enough to become a pharmacist; not to mention someone inclined in that direction would already probably be some kind of focused science major instead of a more general humanities/social sciences major.
Even without promotions, second and third year IB analyst compensation has historically risen faster and generally the exit opportunities are much better. Less than 15% of my analyst class stayed on to become an associate, but that doesn't mean it wasn't a worthwhile experience that led to good things for the rest of us.

[/quote]

Because ibanking doesn't require any particular/specific skill set from academia, it would be safe to say you could major in anything and become an ibanker. Thus, a pharmacist CAN become an Ibanker. An Ibanker cannot become a pharmacist. An engineer CAN become an ibanker but the reverse is not true.
What this implies is that someone with a PharmD or a Engineering degree will always have more "exit opportunities" than your typical ibanker.
If I worked in ibanking and the economy falters and my superior wants to cut my income substantially I won't be with the rest of the pack worrying about my job. I'll be able to say, "Hey! I can make $200k/year working 72hours/week whether the economy is good or bad so THAT is the figure you have to beat no matter the circumstances." I can tell you it feels good when you have the upper hand. Theoretically, you would be able to take advantage of the financial sector when times are good and you'll be able to at least have a baseline of income during which times are really bad.</p>

23

<p>
[quote]
An Ibanker cannot become a pharmacist. An engineer CAN become an ibanker but the reverse is not true.
What this implies is that someone with a PharmD or a Engineering degree will always have more "exit opportunities" than your typical ibanker.

[/quote]
</p>

<p>Just because an I-banker can't become a pharmicist does not mean that a pharmacist has more exit opportunities. There are a lot more jobs related to some realm of finance than there are things that a pharmacist is going to be able to move into. Plus, the upside is distinctly capped compared to what people in IB are able to move to.</p>

24

<p>Polo, no offense, but you don't really know much about pharmacy school, huh? Not everyone is a National Guard member, and not everyone wants to go to Rutgers for pharmacy. Again, this is not a knock on Rutgers, but it is hardly a top pharmacy school.</p>

<p>I have family members that went through pharmacy school. While I'm sure there are schools that accept students from HS, the top pharmacy schools run FOUR YEAR curricula for a Pharm.D. Let me spell that out for you: that's four years as an undergraduate and then four ADDITIONAL years at pharmacy school. You are completely disillusioned if you think that every graduate is going to earn six figures out of pharmacy school. You have to be at the top of your class AND you have to go to a top pharmacy school. How much does it cost to go to a top pharmacy school? UNC-CH, arguably one of the best pharmacy schools in the country, costs a whopping $33,000 per year (Tuition/Costs</a> — UNC School of Pharmacy). Do the math: $132,000 for a Doctor of Pharmacy degree.</p>

<p>Do you understand the simple economic concept of "opportunity cost" at all? Take your typical Ivy League undergrad who is planning to either pursue a career in pharmacy or one in banking. Assuming no financial aid and no other extreme circumstances, here is how the scenario breaks down: </p>

<p>Pharmacy:
- Ivy League for undergraduate degree: -$200,000 (4 years)
- UNC, UT-Austin, or USC for Pharmacy school: -$132,000 (4 years)
- Compensation during first year with a Pharm.D.: +$200,000</p>

<p>Banking:
- Ivy League for undergraduate degree: -$200,000 (4 years)
- 2-year Goldman Sachs Analyst Program compensation: +$250,000 (2 years)
- 2-year Pre-MBA Blackstone Private Equity Associate program compensation: +$400,000 (2 years)</p>

<p>Mind you, the salaries above are arbitrary and indeed the current markets have changed comp at the junior level a little bit. As you can CLEARLY see, in the nine years from the beginning of your undergraduate degree to your first year out of pharmacy school, you will actually hold a significant net LOSS due to the exorbitant amount of pharmacy school. In banking, you will be at a significant net SURPLUS. Again, salaries have changed and the surplus will not be that dramatic -- but it'll be a surplus nonetheless.</p>

<p>Money aside, you also have to consider the opportunity cost. By definition, to get a Pharm.D. you have to go through pharmacy school. In banking, a higher degree is not required (common, but not really necessary). In addition, if you choose to pursue an MBA, many firms will sponsor your education for all its costs.</p>

<p>Feel free to poke holes at my argument, and I will clarify and go into more detail.</p>

25

<p>
[quote]

Polo, no offense, but you don't really know much about pharmacy school, huh? Not everyone is a National Guard member, and not everyone wants to go to Rutgers for pharmacy. Again, this is not a knock on Rutgers, but it is hardly a top pharmacy school.

[/quote]

You're telling me I don't know much about pharmacy school when I'm actually in it and you only know of family members that went through pharmacy school? As long as you pass the license exams and graduate with a PharmD, it really doesn't matter which pharmacy school you come from. Being in a top pharmacy school doesn't even matter and we as a field largely don't care about what your school is ranked as long as it passes the accreditation standards.

[quote]

You are completely disillusioned if you think that every graduate is going to earn six figures out of pharmacy school. You have to be at the top of your class AND you have to go to a top pharmacy school.

[/quote]

Again, you probably don't know much about pharmacy school do you? You don't have to be at the top of your class. You can be the worst person in your class and as long as you meet the standard you'll be in demand.

[quote]

How much does it cost to go to a top pharmacy school? UNC-CH, arguably one of the best pharmacy schools in the country, costs a whopping $33,000 per year (Tuition/Costs — UNC School of Pharmacy). Do the math: $132,000 for a Doctor of Pharmacy degree.

[/quote]

No, incorrect. Read my previous post.

[quote]

Pharmacy:
- Ivy League for undergraduate degree: -$200,000 (4 years)
- UNC, UT-Austin, or USC for Pharmacy school: -$132,000 (4 years)
- Compensation during first year with a Pharm.D.: +$200,000</p>

<p>Banking:
- Ivy League for undergraduate degree: -$200,000 (4 years)
- 2-year Goldman Sachs Analyst Program compensation: +$250,000 (2 years)
- 2-year Pre-MBA Blackstone Private Equity Associate program compensation: +$400,000 (2 years)

[/quote]

Incorrect.
Pharmacy:
-6 year PharmD program such as Rutger's EMSOP from HS: -$70,000
-If you're in the NG cost of PharmD: $0
-Compensation during first year: +$200,000
Banking:
-Ivy league for undergrad: $-200,000
--BEST case scenario in a GOOD economy first year compensation: $125,000</p>

<p>The point I was making was that gellino said...

[quote]

the money is still going to better than any other options besides rock star, actor or professional athlete.

[/quote]

I have clearly showed you a path that would be a better option than investment banking if you're actually cut out for it.

[quote]

In banking, a higher degree is not required (common, but not really necessary).

[/quote]

...which is a downside because there are very low barriers of entry.</p>

26

<p>Generally first year IB analysts make ~60K base, 10k signing bonus, and even this year in a bad economy are making $15-35k bonus on top of that at the end of the year. While there are fewer positions available at top bulge bracket firms, most firms are still hiring at least a few summer analysts and on campus recruits. </p>

<p>Your best bet for getting a banking job is if you are a top student at a top 10/ivy league school. There are boutique banking jobs available, but if you want to move into private equity or hedge fund after your 2 year analyst job, your best bet is to work at a top bulge bracket firm. </p>

<p>$1,000,000 bonuses will not always be gone, and are only capped at firms receiving government assistance. Therefore, many top bankers are leaving for top boutique's (Ie: Lazard, Blackstone, etc). or foreign banks (UBS, Deutsche, Credit Swisse). </p>

<p>Analysts are still making approx. $100k their first year out of college. In 2007 at the peak, first years were making closer to $150. In investment banking, the base salaries are close to management consulting in your first two years, however, even now the bonuses are not the same as top consulting firms like McKinsey, Baine, BCG. </p>

<p>The trade off with banking is that if you are investment banking (different than trading or sales), you will still be working 80-100 hour weeks. Bankers are pitching more deals than ever, and are working hard to get new business since there are few transactions in the marketplace now. You have to keep the hours in mind when thinking salary. Most bankers expect a bonus as part of total compensation (and at 100 hour weeks they should make more than a consultant working 60 hour weeks). </p>

<p>At my university, most top business students are still taking banking offers over consulting and other options. It is well known that for those who make it through the financial crisis and still have their jobs will be well set up to reach top ranks at their firms, so starting in a bad economic time could be a good thing because there may be less competition to the top of the corporate ladder. </p>

<p>The profession is definitely not dead, firms are still hiring, it is just more selective. Many companies are looking to sell themselves because they do not have the cash to stay open and a sale is better than closing. </p>

<p>I think in the past more mediocre candidates were able to get banking jobs, and it will be much more tough to get a job this year, since they can select the cream of the crop. At my school banking positions still received close to 500 resumes for each job posting.</p>

27

<p>So will banking bounce back to where it was 2-3 years ago when the economy stabilizes?</p>

28

<p>The</a> Harvard Crimson :: News :: Jobs Tough To Find For Future Financiers </p>

<p>Students</a> compete for fleeting internships - The Daily Princetonian</p>

29

<p>We're not talking about Rutgers or your special circumstance with the National Guard. I'm talking about the TYPICAL student who graduates from a top school and looks to move onto pharmacy school -- that's a FOUR YEAR PROGRAM which costs $132,000.</p>

30

<p>I think this argument has gotten out of hand. I'll offer my thoughts in a bit.</p>

31

<p>Polo, I think your case is an exceptional one -- not many pharmacy students have the luxury of paying only $70,000 for a six year program. The reality is that the majority of students interested in pharmacy will have to go through a traditional undergraduate degree and then go through an additional four years of pharmacy school. Now, I am not in pharm school (and I don't have any family that is going through the program), but what omaplata said is absolutely true. What I think omaplata was trying to convey (albeit crassly) is that you are taking your own personal experience and extrapolating it for the majority -- you can't do that. Not everyone is in the National Guard and not everyone is interested in doing a six year program out of high school. Most people will enroll in a four year curricula at pharmacy school post-undergrad, and the costs of pharmacy school will be around $130,000 as omaplata stated.</p>

<p>Also, when you posted this:</p>

<p>
[quote]
Incorrect.
Pharmacy:
-6 year PharmD program such as Rutger's EMSOP from HS: -$70,000
-If you're in the NG cost of PharmD: $0
-Compensation during first year: +$200,000
Banking:
-Ivy league for undergrad: $-200,000
--BEST case scenario in a GOOD economy first year compensation: $125,000

[/quote]
</p>

<p>You are conveniently ignoring the fact that pharmacy school is an additional FOUR years of schooling (which means it's a double expenditure -- 1) the upfront cost of tuition and 2) the opportunity cost/ wages you could have made in those four years if you were working). Think about it logically: bankers clearly make more money than pharmacists.</p>

<p>Also, I am not sure where you got your figures from (both you and omaplata) but pharmacy school graduates on average "only" make slightly above $100,000 -- Pharmacy</a> salary information: Average earnings over $100,000 - Drug Topics' annual salary survey: Pharmacists' average annual base salary has now cracked six figures, but stress levels and work volumes</p>

<p>Omaplata, Blackstone Private Equity pays all-in compensation of $325,000 per year as a first year associate. Thus, the gap between a professional in finance and a professional in pharmacy is much larger than you noted.</p>

32

<p>
[quote]
Compensation during first year with a Pharm.D.: +$200,000

[/quote]
</p>

<p>It's virtually impossible to make that kind of money for a pharmacist unless you work 2 full time jobs. Each shift is 8 or 10 or 12 hours at most and one gets overtime after 8 hours. Very few places give you more than 50 hrs. a week.
In CA where the average salary for pharmacist is among the highest in the country, the pay is around $55 per hour.</p>

<p>
[quote]
Blackstone Private Equity pays all-in compensation of $325,000 per year as a first year associate.

[/quote]
</p>

<p>This person will probably have an MBA from a top school and has had several years of finance experience. This is not an entry level job right after college.</p>

33

<p>
[quote]

Polo, I think your case is an exceptional one -- not many pharmacy students have the luxury of paying only $70,000 for a six year program.

[/quote]

[quote]

What I think omaplata was trying to convey (albeit crassly) is that you are taking your own personal experience and extrapolating it for the majority -- you can't do that.

[/quote]

I agree. I'm not arguing that this is the average case. I was only responding to this remark...

[quote]

The salaries of the last few years may be gone for a while, but for someone graduating from college this year or next, *the money is still going to better than *any other options **besides rock star, actor or professional athlete

[/quote]

I think that I have proved this assumption to be wrong using myself as an example.
Would you agree that in MY case choosing pharmacy will put me ahead financially based on these circumstances?
1. An extra 2 years of school for a PharmD compared to a BS.
2. Pharmacy school costs me virtually nothing whereas a private school such as NYU Stern would cost me $200,000.</p>

34

<p>Polo, absolutely -- I think what has gotten lost in all this bickering is that you are on the fast track to success (and a rewarding career). You figured out what you wanted to do early, you entered an accelerated program at a very low cost, and you will be well off financially.</p>

<p>The bottom line is that whether you're a rock star, actor, professional athlete, pharmacist, banker, whatever -- you will enjoy a great career if you 1) enjoy what you do, 2) work hard and start early, and 3) persevere. I think everyone can agree with that.</p>

35

<p>
[quote]
Omaplata, Blackstone Private Equity pays all-in compensation of $325,000 per year as a first year associate. Thus, the gap between a professional in finance and a professional in pharmacy is much larger than you noted.

[/quote]
</p>

<p>Assuming this person has a top MBA and has several years experience in a top bank. And assuming this person has the right connections to get the job. And also assuming the the "professionals" you work for didn't run the economy into the ground that year. And if they did, assuming they didn't fire you. That's a lot of assumptions.</p>

<p>I'm all for letting all the banks go under if it wakes people up to the reality that banks need regulation.</p>

<p>Even so, 60% of that $325k is discretionary compensation. So your guaranteed compensation is around $135k (I wouldn't count on bonuses, no matter how customary it is to get them-it's called DISCRETIONARY for a reason). I can do better than that in biglaw. No, I won't become a billionaire, but I'll still have a job (and a professional license) through thick and thin, as long as my specialty is in demand (or as long as laws exist).</p>

<p>IB will likely never come back to where it was two years ago, nor should it EVER get back up there. That level was totally and completely unsustainable and if it ever gets up there again I'm polishing my resume because a crash will quickly follow.</p>

36

<p>
[quote]
So will banking bounce back to where it was 2-3 years ago when the economy stabilizes?

[/quote]
</p>

<p>Everything goes in cycles. Companies will always need to access the capital markets, in whatever form they evolve into. There will always be intermediaries (the IB's) willing to make the big bucks hooking up the two. That is, until the internet can replace the IB's.</p>

37

<p>
[quote]
I think that I have proved this assumption to be wrong using myself as an example.

[/quote]
</p>

<p>It's not really intellectually honest to take a one-off case that requires two extra years of schooling, the need to decide to enter the field by age 17 and work what effectively sounds like two jobs and compare that to the circumstances of the 'average' college senior that enters an IB analyst program.</p>

<p>What is also lost on the other side of the argument is out of all those entering an IB analyst program, the ones entering Goldman is a small percentage and those working at Blackstone in PE for the third and fourth years of their career is even rarer still.</p>

38

<p>You guys aren't taking cost of living into account. My goal is to amass wealth. To do that, I need to save as much as possible. Living in NY on an analyst's salary doesn't allow you to accomplish this goal unless you live like a starving artist. Obviously an MD can amass tremendous wealth, but that's taking the very best case scenario. A PharmD (I'm not a PharmD, BTW) can save over half their income, depending on where they work. Obviously anyone in finance knows the more money you can save earlier on, the better.</p>

39

<p>
[quote]
My goal is to amass wealth

[/quote]
</p>

<p>He who dies with the most toys wins.</p>

<p>but in the end, you are still both dead.</p>

40

<p>wutang: I just took the cost of living into account. That's one of the reasons I'll probably go to Toronto for law school :)</p>