Newspapers may be filled with reports of layoffs and job cuts but there’s one sector of the financial services industry that seems to be riding out the storm better than others. Glocap Search and Thomson Reuters report that compensation for executives at U.S. private equity firms has actually risen this year, across almost all categories of staff.
The rise in compensation has been driven by growth in assets under management, regardless of the credit crunch and a lower deal volume. According to the report, compensation for principals at large private equity firms averaged US$885,000, up 4% from last year. Bonuses edged up 6% to average US$607,000.
The report also noted that bonuses for associates at venture capital funds and senior associates at the larger buyout and growth equity funds edged higher.
However, Brian Korb, head of the private equity practise at Glocap commented that this compensation growth is likely to slow down. “Compensation is up, but funds are taking a more conservative approach as they structure packages and consider promotions going forward,” Korb said.
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