End-of-year bonuses for private equity professionals are likely to be higher at larger managers compared to midsized and small buyout shops, as banks’ blowout earnings put pressure on PE firms to keep pace on pay, according to projections from compensation consultant Johnson…
sociates. Its Q2 year-end projections report, which predicts Wall Street end-of-year bonuses based on recent market trends, said that PE professionals at large buyout shops can expect bonuses anywhere from 2.5% to 7.5% higher than what they received in 2025
That’s an improvement over the Q1 outlook of no change up to a 5% increase. The jump is due, in part, to mounting competition for talent between PE firms and banks, said Alan Johnson, president and founder of Johnson Associates. Private equity firms will likely offer stronger sweeteners to retain talent during a challenging period. “Banks and private equity compete for talent, and as the banks do better, there’s going to be a bit of a drag-on effect to private equity,” Johnson said.
Investment banks are having a great year. Goldman Sachs and JPMorganChase both reported strong Q2 results, with Goldman’s earnings per share nearly doubling year-over-year to $20.98 and JPMorgan’s net income up 41% to $21.2 billion. The surge was driven by an uptick in M&A volume and a handful of mega-transactions, such as the record-breaking SpaceX IPO that Goldman led in June.