Investment Banking

Annual revenue in the global investment banking market is expected to reach $420 billion by 2029, according to Statista. “The growth in the investment banking industry is driven by several factors, including strong corporate dealmaking, technological advancements, and the evolving financial needs of businesses and investors,” according to the Investment Banking: Global Strategic Business Report from ResearchAndMarkets. “A key driver is the resurgence of M&A activity, fueled by corporate restructuring, industry consolidation, and increased private equity involvement. As companies seek strategic partnerships, market expansion, and operational synergies, investment banks play a pivotal role in structuring, negotiating, and financing these high-value transactions.”

The diversity of occupations in investment banking makes it difficult to make projections about employment opportunities that ring true across the industry as a whole. Investment banking, collectively, is an umbrella for many different occupations—underwriting, distributing, and trading securities; providing financial advice; and managing client wealth. But the U.S. Department of Labor (DOL) does provide employment outlook information that will be of some use to those wishing to enter the field. Unless otherwise noted, these predictions reflect an employment outlook for these workers in all industries, not just investment banking.

Employment of securities, commodities, and financial services sales agents (including investment bankers and investment banking sales agents and traders) is expected to grow 3 percent from 2024 to 2034, according to the DOL, or as fast as the average for all careers. The DOL says that "services that investment bankers provide, such as helping with initial public offerings and mergers and acquisitions, will continue to be in demand as the economy grows.” The U.S. remains an international financial hub, and its employment growth is fueled by the economic growth of other countries. However, the DOL reports that “automated trading systems have reduced demand for securities traders.” Competition will remain strong for these high-paying, often prestigious jobs. Those with a master’s degree in business administration or finance, the chartered financial analyst credential, expertise in how AI is being utilized by the investment banking industry, and a strong grade-point average (for new graduates) will have the best job prospects.

Job opportunities for financial analysts (buy-side analysts, sell-side analysts, portfolio managers, fund managers, ratings analysts, and risk analysts) are expected to grow by 6 percent from 2024 to 2034, according to the DOL, or much faster than the average for all careers. The DOL says that “emerging markets throughout the world are providing new investment opportunities, requiring expertise in geographic regions where those markets are located.” Despite this prediction, there is strong competition for jobs in this field because these careers pay well and offer a path to occupations with even more prestige and higher earnings. Again, those who are certified or who have advanced degrees will have the best job prospects.

Employment for financial managers (e.g., treasurers, chief financial officers, risk managers) is expected to grow by 15 percent from 2024 to 2034, according to the DOL, or faster than the average for all careers. The DOL says that “services provided by financial managers, such as planning, directing, and coordinating investments, are likely to stay in demand as the economy grows. In addition, several specialties within financial management, such as cash management and risk management, are expected to be in high demand over the decade.”

Information security analysts who are employed in the finance and insurance sectors will enjoy employment growth of 27.2 percent during this same time span. Demand will be strong as the banking industry continues to strengthen its IT security infrastructure due to cyberattacks. Banks are increasing their cybersecurity budgets and seeking to hire more information security analysts, chief risk officers (who are responsible for ensuring data security as well as managing many other areas of risk), and ethical hackers (also known as white-hat hackers). Despite the strong demand for information security analysts, there’s a shortage of workers in the field. In 2024, the computer security association ISC2 estimated a shortage of 5.4 million cybersecurity professionals worldwide.

The growing use of artificial intelligence (AI), distributed ledger and blockchain, data analytics, and cloud computing technology will create strong demand for tech workers familiar with these technologies and the investment banking industry. There is currently a shortage of technology workers with this expertise. The information technology association CompTIA recently listed machine learning, cloud computing, data analysis, data science, data visualization, and Big Data among the top 20 in-demand technology skills. “The largest banks are automating work anywhere they can, especially routine work like cutting and pasting data from one app to another," according to American Banker. “Use of AI and robotics will only grow provided banking regulators become more open-minded about them. This will dramatically change banking jobs and the skills required to do them. People will be needed to design and train bots and AI engines, to test and oversee them, and to manage the employees who do those jobs.”

Some of the best employment opportunities in investment banking can be found, not on Wall Street, but in other financial centers around the country and world. Some opportunities that stand out are in product management, marketing, and restructuring troubled companies. Some specialty areas of banking are hard to break into, and they require specialized skills and, in some cases, prior industry experience. In debt restructuring, which involves helping over-leveraged companies shed their debt load, a legal background or some expertise with corporate bankruptcy filings is helpful. Debt restructuring is usually the province of boutique firms such as Evercore, Rothschild, or Greenhill. The biggest players in this field are Blackstone, Lazard, and Houlihan Lokey.

Investment banks are no longer the dream job destination for many finance majors due to declining compensation packages and perceptions by young people that these employers are not as employee-friendly as those in other industries. The Boston Consulting Group reports that “social-media and technology companies are attracting Millennials by appealing to their desire for global experiences, high levels of responsibility, rapid advancement, and an attractive work-life balance. Overall, investment banks are losing the human resources battle.” Investment banks are also facing strong competition for employees from private equity firms, hedge funds, and venture capital firms. Other young analysts are leaving to pursue advanced degrees in finance or business administration. Some investment banks have realized that they need to create more worker-friendly environments to attract and retain top talent (especially in areas that are not high-paying). “Investment banking is becoming more inclined to the thought that ‘employee satisfaction is the key to customer delight,’" according to Quantzig, a data analytics firm. “Especially after the emergence of platforms like Glassdoor and social media, where the negative work experiences can be made public, the players in investment banking have realized that their reputation is at stake here.”