Asset managers’ incentive compensation are shaping up to remain flat in 2019. This news is sure to be met with disappointment, but Alan Johnson, managing director at compensation consultancy Johnson Associates, says that things could have been a lot worse.

At the turn of the year the first quarter incentive compensation scenario looked a lot more somber, but the market rebound improved the forecast, Johnson says.

“We were thinking that compensation would be down in the asset management business for 2019. So, the very nice market uptick in the last four, five months changed it the outlook of being negative to flat,” he says.

Still, flat incentive compensation packages can be hard to swallow.

“The challenge is to manage people’s expectations because, the results kind of made a ‘V,’ they went down in the fourth quarter, they are up in the first quarter, but it gets us back to break even,” Johnson says. “Your pay is not going to be up if the industry is kind of flattish from here to the end of the year.”

Fund Fire / May 9, 2019