Big bucks to be made in the Big Apple

In the US, it pays to be a fund manager who specialises in international funds, works for a mutual fund company and lives in New York.

In the US, it pays to be a fund manager who specialises in international funds, works for a mutual fund company and lives in New York.

When Frank Sinatra first started belting out his New York, New York number, he must have been thinking of fund managers.

A recent survey of salaries across the investment management industry in the US by the Association for Investment Management and Research (AIMR) and recruitment group Russell Reynolds Associates, has found the biggest dollars go to east coast employees in mutual fund organisations, specifically those employees deal-ing in international equities.

Mutual fund companies were the most generous of all employers in the US finan-cial services market, with the average investment professional salary at this type of organisation expected to total US$196,000 a year. This is 24 per cent more than investment professionals in insurance companies, banks, securities firms or as investment advisors.

Considering the median salary of a US worker only nudges above US$28,000 a year, this would give you some indication of the growing demand in financial services.

Russell Reynolds Associates' global head of investment management practice Rich-ard Lannamann says the competition in the market for talented professionals means financial services firms in the US are having to put their money where their mouth is to attract new staff as well as retain their current batch.

"There is strong competition for top investment management talent. The rapid growth in the investment management industry has caused employers to value highly those who are deemed able to provide superior performance or attract as-sets," he says.

An Australian financial planner will be pleased to know his or her services are potentially worth a mint in the US market. In 1999, the median salary for secu-rities brokers/dealers was US$185,000. However, pension consulting firms came in at the lower end of the survey. Their professional employees earned an average of US$95,000 a year.

If you're aiming for the big end of town, it is also best to think global rather than domestic, the survey found. Global equity managers came up trumps in the earnings stakes, with portfolio managers and analysts earning US$211,000. Domes-tic equity managers, in comparison, earned an average US$153,000. In comparison, global fixed income managers took home US$185,000 while domestic managers bagged US$158,000.

Not surprisingly, experience definitely pays well in the US. Employees with more than 10 years of experience in investment management taking home bigger pay packets of up to US$200,000, according to the survey.

Being male, it seems, also helps when it comes to employers handing out extra cash. In 1999, males earned 17 per cent more than their female counterparts on average in the US and Canada. The survey also found, however, that age came into play in this regard, with men with less than five years of experience in their field earning 9 per cent more than women of the same calibre.

When it comes to employee bonuses, 60 per cent of those surveyed said the deter-mining factor was the organisation's overall business performance, followed by the individual employee's performance (45 per cent), the organisation's invest-ment performance (42 per cent) and the employee's business development perform-ance (40 per cent).

Russell Reynolds Associates' Investment Management Practice executive recruiter Debra Brown says mutual fund employers and securities brokers/dealers were the most likely to pay employees bonuses this year.

"Incentive compensation is most significant at mutual fund firms and securities brokers and dealers, accounting for roughly half of the median total compensa-tion at these organisations. This finding is consistent with their pay-for-performance cultures and the trend towards greater differentiation in remunera-tion," she says.

The survey also found investment professionals in the US earned 25 per cent more than their Canadian counterparts, and directors of research and those profes-sionals involved in marketing or client services earned the same salary as in-vestment managers. For those in the industry pitching their services to high net worth clients, beware. Those servicing institutional clients are actually ex-pected to earn more on average in the US and Canada this year, than those work-ing with high net worth clients.

The survey, compiled by independent US market research firm Wirthlin Worldwide, drew responses from more than 8,500 AIMR members in Canada and the US.