New York (CNN Business)Goldman Sachs is spending less on employee compensation and more on ramping up tech ventures.
Scherr also said Goldman has been spending less on compensation because the company has brought in lower revenues.
“Our philosophy remains to pay for performance,” he said during an October 15 earnings call.
He also noted that Goldman’s growing investments in “platform-driven businesses” will cause further declines in the amount of money it needs to spend on employee pay.
Newly reported compensation data also shows employees are already making less, on average, than they were a year ago.In the most recently completed quarter, average pay per employee was $72,249, down from $83,168 a year earlier. Those figures do not include bonuses or other types of pay packages that can boost a person’s annual compensation.
Over the same period, Goldman’s total number of employees increased to 37,800 from 36,300. Much of that increase can be attributed to Goldman’s decision to beef up its asset management business by acquiring United Capital, its largest takeover in nearly 20 years.
CNBC analyzedGoldman Sachs compensation data going back 10 years and found the average employee earned $246,216 during the first three quarters of 2019 — compared to $527,192 during the same period in 2009. That figure, CNBC noted, was calculated by dividing the bank’s compensation pool by the number of workers.
It reflects the evolution investment banks have been forced to undergo in the high-tech era, when trading is done mostly by computers and post-recession regulations.