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FT editor Roula Khalaf has chosen her favorite stories in this weekly newsletter.
It used to be that you could tell the state of the banking industry by walking around and looking at neckties.
Since the first “casual Fridays” in the 1990s, investment banks seem to have followed a pattern of relaxing their dress codes during bull markets and returning to suits and ties when profits decline.
As the dot-com bubble grew, Wall Street became:
But a few years later, they all started wearing suits again (and not just because they were on trial for fraud).
By 2006, things had changed again, but the Great Financial Crisis hit business casual bankers hard. By 2010, UBS began giving bank employees instructions about underwear.
And the cycle. . . A kind of end. People stopped wearing ties, and suits gradually followed. If you see someone in a suit and tie at an investment bank these days, they’re either very young or very old, and they’re either attending a conference or trying to get a security pass.
It may have been thought that a “remote work policy” could serve as a dress code in the new post-corona market. Psychological and economic factors are similarly combined.
On the other hand, difficult markets create a sense of powerlessness in managers, which they try to compensate for by reaching for things they may have control over, such as the way their employees dress. On the other hand, strong earnings conditions tend to be accompanied by a tight labor market, making it difficult to reduce worker benefits.
That’s why it’s so interesting to hear that JPMorgan is rumored to be planning a move to a “five-day office” move in the coming weeks. As Bloomberg reported last week:
JPMorgan Chase is preparing to tell all employees to return to the office five days a week, eliminating hybrid work options for thousands of employees and reverting to time and attendance policies in place before the pandemic .
The largest U.S. bank, which employs more than 300,000 people worldwide, plans to announce changes in the coming weeks that will replace the existing three-day work requirement for many employees, the people said on condition of anonymity. It is said that We are discussing unannounced plans.
The decision, which is subject to change, expands on existing rules announced in April 2023 that require the bank’s managing directors to work five days a week. Approximately 60% of the bank’s staff, including many traders and retail store employees, are already operating under the requirements.
It makes sense to do this if you were expecting a downturn in the market. This was an environment in which the original “three-day week” policy was enacted after the pandemic, with some markets attempting to move to a four-day week. But everyone seems very optimistic for 2025, with JPMorgan itself saying it has a “long list” of people it wants to hire.
So, the first thing to think about is that bankers actually love commuting to the office. Second, this theory is all wrong, and the tie indicator has no real socio-economic basis at all and is just a coincidence. Third, JP Morgan is wrong and they will not be able to follow through with this policy.
And the fourth is that everyone is right, this indicator is reliable, JP Morgan is leading the way, and 2025 is actually going to be a very disappointing year.
