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Jobs plummet, recruiters feel the pain

10 April 2008

Sarah Butcher

Banking job vacancies have taken a nasty turn for the worse, and so have recruiters’ fortunes.

With banks struggling against writedowns and calls for the sale of their investment banking arms (in the case of UBS and Deutsche), this is hardly the time for hiring.

The resulting softness in the banking job market is reflected in new figures from recruitment firm Morgan McKinley: in March 2008 new financial services job opportunities were down 23% on the previous year.

More worryingly for anyone looking for a role, there are now 20% more candidates than jobs – an absolute difference of 1,753.

Recruiters are starting to suffer. Shares at Michael Page plummeted 10% this week after it revealed that profits from its UK banking division fell ‘in very, very low double percentage figures’ in the first quarter of 2008 vs. the same period of 2007.

Hiring freezes, but middle office still strong

Most banks are said to have imposed hiring freezes on front office positions: “Front office hiring at big banks is off 50%, probably more,” says one headhunter.

Optimists aren’t extinct yet, though. Upbeat observers point out that 2007 was a record year for banking recruitment, making recent reductions in job vacancies unfortunate but not unbearable.

“Middle office hiring is still active,” says Paula Maidens, director of financial services hiring at recruitment firm Robert Walters. “Product and risk control jobs are essential, regardless of market conditions.”

Jalpa Chandarana, manager of the investment management division of recruitment firm Joslin Rowe, is equally ebullient: “We have more jobs in investment management now than we’ve had for the past five years. Hiring in the investment manager market tends to be quite consistent.”

Comments (15)

too much euro-trash has landed into the financial markets with degrees from obscure seaside business schools. they may be linguistically good but invaiably have the financial savvy of a goldfish.

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Comments (15)

  • Product and risk control jobs are only essential if a bank/i-bank/hedge fund still exists! I don't think even recruiters can talk there way out of this - big job losses on the way.

    Anonymous 10 Apr 2008

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  • These people will have to go elsewhere and take their experience with them, so when things pick up, the investment banks will be fishing from a smaller pool and that means increased costs, not to mention the experience (and therefore investment) lost to the industry. Hiring freezes are damaging to an organisation's reputation. Easy to stop hiring, but once the "word is out on the Street", it will become difficult to attract the talent back.

    Wizard of EC1 10 Apr 2008

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  • Completely agree the pool is shrinking and the real economy is subject to derived supply and demand; cut in supply leads to cut in demand the bigger the rise the harder the fall !!!

    Marko 10 Apr 2008

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  • Recruiters may have open vacancies but the measure needs to be on closed and completed hires.

    It no good have open jobs that havent got a hope of being signed off - which is probably more the case...

    Also need to factor in that if trading desks are being shut down the support personnel will be re-dispatched to other desks where possible - decreasing the likely hood of external hiring.

    In House Recruiter 10 Apr 2008

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  • It seems the Bear is in the corner, attracting all the attention; but shouldn't we watch our backs for the bull?  The room is only so big!!

    Sandro 10 Apr 2008

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  • I had a call from a reporter asking about a rumour that a large bank is about announce substantial lay-offs. I explained that to my knowledge this was true but that hiring would continue with that bank as all they had was a headcount freeze at today's levels. The reporter had no idea about the difference between a headcount freeze (bring one in as long as you've kicked one out) and a hiring freeze (does what it says on the tin). The press also have difficulty separating search from recruitment. Search has always been strategic albeit with varying levels of freneticism. Strategic hiring, staff up-grading and the cherry picking off from competition continues unabated.

    Of course the market is hurting and so are the headhunters but when the press fail to make distinctive differences clear they should rightfully be castigated for fuelling flames that frankly, don't need any more oil.

    Headhunter 10 Apr 2008

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  • Indeed the market is tightening. One of the key challenges is actually encouraging candidates to make the move even post bonus period which is traditionally the recruitment frenzy period. Candidates are increasingly fearful of the "last one in first one out" attitude too. Where interviews have taken place with candidates who have been made redundant, one question that has featured a lot is "do you want this role because you need a job, or because you want this role? Explain" So be prepared.
    RE comment from in-house recruiter, any agency side recruiter worth their salt would not be wasting their time recruiting for roles they cannot fill. Remember that recruiters get paid on results, not for treading water.

    Risk Recruiter 10 Apr 2008

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  • Large / Globally Branded banks tend to all have the same reactions to the same issues, in this case when one starts to lay-off people the others follow. This happened in Private Banking in Switzerland 9 years ago, the result has been to growth in Independent asset managers, reduction in total cash profits for the Banks(but good figures as the profit per headcount)

    Swiss Search 10 Apr 2008

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  • I sincerely hope 50% of people involved in investment banking in London get fired in this downturn. There are far, far too many people in this industry, many of them utter cretins, lacking in people skills, looks and education. Downsize the industry and make working in banking an achievement again!

    Schaudenfreude 11 Apr 2008

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  • too much euro-trash has landed into the financial markets with degrees from obscure seaside business schools. they may be linguistically good but invaiably have the financial savvy of a goldfish.

    hadenough 11 Apr 2008

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