As the financial crisis starts to become a distant memory (notwithstanding the real concern that more bad news may be on the way), investment banks and asset managers are once again on the hire. But they are finding it hard to attract the talent they seek at present, as market professionals are understandably waiting to bag their 2009 bonus payouts before moving on.
But after 2009 bonuses are paid, many market watchers are expecting a huge game of musical chairs, as bankers move on after 2 years of frustration at their current firms. One banker told Here Is The City: 'After two years of worrying about the safety of your job, stressing over doing too much work (because your department is under-resourced), and weariness over all the cost containment initiatives, many will feel it is time for a fresh start. Most people stuck it out where they were simply because there was no place else to go. They have options now, and many are going to take them'.
But what about the fact that a major part of this year's bonus payouts are going to be paid in deferred equity. Won't that make staff think twice before moving on ? 'Not at all', says our banker, 'Regulators and governments around the world appear to believe that paying bonuses in this manner will encourage staff to remain at an organisation for a longer period. The theory goes that staff will also engage in less risky activities if their bonuses are tied to the long term performance of their firm. The reality, of course, is that deferred equity will be bought out (probably by a stock swap) by a hiring firm - it's just another recruitment cost.
One recruiter told us: '2010 is likely to be a good year. It has all the right ingredients - years of built in frustration on the part of candidates giving way to a recovering market where clients are keen to hire to retain a competitive edge. Sometimes people just need a change, and I'm betting that next year the recruitment market comes back big time'.