Morgan Stanley is offering newly promoted vice presidents a paid sabbatical in a bid to stop them defecting to tech startups of hedge funds, according to the Financial Times.
A source told the FT on Friday that the bank recently introduced the 4-week paid leave programme but Morgan Stanley declined to comment to the paper.
Morgan Stanley is not the only investment bank to use time off as a carrot to try and retain staff. UBS announced this week that it is giving staff a “personal time” allowance of 2 hours a week and Credit Suisse has told staff to leave by 7pm on a Friday and not return until at least lunchtime Saturday. Citigroup has also introduced a plan to let junior staff take a year off to do charity work at 60% pay.
All are trying to improve work-life balance at the banks to stop talented staff defecting.
Investment banks used to be a magnet for the best and the brightest but many are struggling to recruit in the way they used to because of the rise of tech companies and the tarnishing of the banking industry’s image post-2008.
I once heard a senior executive at a top investment bank recall how they had to give personal guarantees to one talented graduate who also had offers from Facebook and other top tech firms. That graduate now gets 1-on-1 mentoring sessions with the executive each month.
Even if banks do lure in top talent, they also face a struggle to hang on to them. Many millennials find the long hours an unrewarding slog with the temptation to jump ship to an exciting fintech startup. Goldman Sachs recently overhauled the way it gives feedback in an attempt to please young staff. Goldman is one of several banks that has also recently introduced a fast-track programme for talented young bankers. Others include JPMorgan, Citigroup, and Deutsche Bank.