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Distressed debt specialists are hot. Restructuring consultants are not.

Bloomberg recently ran an article claiming that distressed debt bankers are currently being hired at the fastest pace for five years in Europe. Banks are said to be raiding the US and paying as much as US$3m for distressed debt and restructuring specialists, with the likes of Morgan Stanley and Blackstone at the forefront of the hiring spree.

Less than a week earlier, however, Reuters reported that restructuring bankers are twiddling their thumbs – so far this year only Italian car parts maker Teksid has defaulted, which hasn't created a huge amount of work.

So which is true? Amanda Rajkumar, head of the fixed income practice at search firm The Rose Partnership, says it's absolutely the case that distressed debt hiring is steaming: "A lot of firms are interested in distressed analysts and people who can source distressed debt business."

Where should distressed debt types focus their attentions? Try the likes of Cerberus Capital Management, Golden Tree Asset Management, Carlyle, Babson Capital Europe, or Intermediate Capital Group. Man Group, the world's largest listed hedge fund company, has also revealed plans to hire for its expanding distressed debt business.

How much can you earn? Rajkumar doesn't confirm Bloomberg's US$3m figure, but says pay is strong: "Distressed debt boutiques and hedge funds will pay extremely well to get people on board – it can cost upwards of US$1m to get a really good distressed debt person."

On the other hand, restructuring consultants who advise companies on how to manage their financial position (rather than actually issuing the debt) may do better to sit it out in M&A. "There's plenty of refinancing work to do, but a lot less in terms of advisory," says Joseph Swanson, head of the European restructuring practice at advisory firm Houlihan Lokey. "A deal every three to four months is not enough to support the whole market."