Senior analysts earn 35% less, associates 21% less and managers 8% less. This gap narrows as more seniority is acquired within an industry. High-level consultants are paid 10 to 30% less than their industry peers. The industry invests as much money as consulting.
You see, unless you're at the top of the consulting pyramid, you're not really earning much. A few thousand locations in MBB. You can now earn the same amount of money with an equivalent job to MD at any number of banks and other companies. And it's much easier to achieve it, and the work-life balance is much better.
And let's not forget capital compensation, that adds up. It should be noted that, while both Parthenon-EY and Deloitte S&O (the consulting service based on the company's strategies and operations) pay higher hiring bonuses than the market, their maximum performance bonuses are considerably lower than those of their BBM competitors. The high degree of autonomy, despite being a key member of your client company's team, is another great advantage of consulting. Meanwhile, after a few years, the reputational value of each incremental year at your consulting firm begins to decline (not zero or negative, but less every additional year).
People in the industry think that a lot of consultants don't know what they're talking about, and with good reason. My current company hired me stealthily, so I left consulting to return to the industry and I'm glad I did because I can make a real difference in the business world. It may or may not be fair, and it may not even be real, but a senior executive profile later on may be more attractive if you have created and changed businesses and have managed people for longer periods of time than you think consulting allows. However, while MBB firms have traditionally paid the best salaries and consulting bonuses, the consulting units of the big four accounting firms (Deloitte, EY, KPMG and PwC), together with a growing range of boutique providers, are now up to par with them in terms of compensation.
PwC runs Strategy& as its elite consulting division along with its current consulting business, and Strategy& employees earn much more than their PwC counterparts. The renewed battle for talent has also contributed to wage inflation, as consulting firms compete for candidates with big banks, which have made substantial increases in their own salaries in the past 12 months, and large technology companies. I would dispute the validity of that, especially if you build offices, sectors, or service lines as a consultant at the partner level, but that stigma is widely assumed. When I finally joined, I was immediately disappointed that consulting isn't as glorious as advertised.
Three firms — McKinsey & Company, Bain & Company and Boston Consulting Group (BCG) — have dominated the global consulting industry's elite for years. This usually means lower salary, but after consulting, you can usually get a position high enough so that the gap isn't too severe. Networking in the consulting world works in a similar way: it's not hard to imagine that being a key player in a variety of teams in a variety of environments creates a wide network of colleagues.