Big 4 Starting Salaries – The FactsBy Francine • Jan 31st, 2008 • Category: Pure Content, Your Career
Well, in the tradition of the WSJ Law Blog and their open disclosure of salaries for first year law firm associates, here you go.
I received quite a few responses to my research request before the holidays that included detailed information about starting salaries. I also had quite a few respondents that had received offers from all four firms, or at least two or three. That, and my previous experience and knowledge of how the firms work, allowed me to come to this non-scientific conclusion:
There is informal, if not formal, collusion on the part of the Big 4 firms, with cooperation of the accounting professors/schools, to fix starting salaries and give the students no chance to negotiate if they have special experience, skills or circumstances.
The following numbers are based on my very limited sample and my experience and are for students with Masters in Accounting. For undergrad, subtract US$ 3-5,000. The numbers are applicable to the East and West Coasts of the US, where salaries and cost of living is higher. For the Midwest, subtract US$ 5-7,000 on average.
For Canada, I’m not sure what the story is, but I’ll tell you what it should be. If there’s no exchange rate difference now, you guys should be paid comparable to your US colleagues.
One of the big complaints of the Master’s students is that they spend a lot of extra money to get the Master’s, sometimes in order to get enough hours for CPA requirements in certain states, but the salaries are not really significantly different from undergrad to pay for the extra time. They all start as 1st year staff anyway.
As you can see, these salaries all hover around a total package of $62-65,000, salary and bonus, with different mixes of salary and bonus offered to make any particular student feel special. There are regional and potentially office differences. I promise to update or adjust as you, the reader, provide more data.
Should you try for a bigger salary or a bigger bonus? If you have the choice, and that’s a big if, I would take the cash up front, even with a payback requirement for not staying the year or two commitment they require. A higher starting salary pits you at a higher salary compared to your peers and means lower raises later, assuming you all do equally well. You’re going to stay within a range, from a base salary perspective, for a while. Any base pay differential evens out over time. The raises for employees with grad degrees are often a smaller percentage – even though the actual RAISE might be bigger the first year or two, it’s because it’s calculated from the bigger base salary.
So always take cash up front! (If they lay you off after the first year, they won’t make you pay it back…)
Then there’s the overtime issue. We’ll have to see what comes out of all these lawsuits. But I hope it is justice.
EY: $60k + $5k bonus (1 year commitment) + 15 vacation days (10 firm holidays) + $1k relocation reimbursement after acceptance of the offer.