Once highly prized jobs on Wall Street or in the City have lost their allure.
The pay was fantastic. There were palatial offices in the smartest locations. Every Christmas there was a bonus with five, or sometimes even six, zeros on the end of it. The lunches were spectacular, and the expenses unlimited. You could make yourself a millionaire by mid-career. For a couple of generations at least there was no more desirable career than banking.
They were the "masters of the universe" in Tom Wolfe's memorable phase in The Bonfire of the Vanities, and they could bend the world to their will. But not any more. Since the financial crash of 2008 the status of the finance industry has slipped and slipped. There has probably never been a worse time to be a banker; the industry faces a downward spiral.
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A structural shift...
It gets worse. The banks are not just responding to a temporary downturn and tightening their belts until demand picks up again. They are also facing new challenges and new forms of competition all the time. Near-zero and even negative interest rates across the world are fundamentally challenging their business model. There isn't much point in depositing any money in the bank if you don't get any meaningful interest on it, and absolutely none if you get charged a negative rate. With fewer and fewer deposits and higher mandatory capital ratios the banks can't do much lending. Banks that don't lend don't make much money, and certainly don't need many employees.
... caused by competition and technology
Amazon has launched a current account, Google and Apple have payment systems that turn your phone into a bank account, and Facebook is even launching a whole new currency, the Libra. It remains to be seen which of those new ideas work and which fail, but some will surely succeed. The traditional banks face a relentlessly declining share of the market, and as they lose customers they will keep on shrinking.
The net result? Careers are ending earlier and opportunities are evaporating. Banking used to attract the best people, and paid the highest salaries. But that is not going to be true any longer. It is unlikely that many bright graduates aspire to a job in banking. In some industries that might not be of any great consequence. But the financial markets relied on having super-bright and highly motivated staff. To prosper, they needed people who could track down deals and make them happen, who could trade furiously, and who could come up with dozens of creative and innovative new products.
Like the media, or tech industry, banking needed to attract the best people to keep growing. If it can no longer offer those people the same kind of rewards and can't keep them on board, it is likely to go into a spiral of decline. It won't have the energy or ideas it needs to keep expanding, or even to hang onto the markets it already dominates. Nor will it have the imagination to reinvent itself as the tech giants move onto its turf. It will take a while, but if banking is not much of a career any more people will lose interest and the sector will inevitably shrink and shrink.
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