With financial markets professionals losing their jobs in their tens of thousands, the supply of talent available to hiring firms has never been so large. The big problem, however, is that the pool of hiring firms has never been so small.
With most firms more concerned to reduce their payrolls, rather than beefing up the labour force, it's truly not a good time to be on the job market - yet over 170,000 people in our industry have been laid-off in the last 12 months, and over 65% of them are thought to be still looking for employment. And as the downturn bites, those who are being let go in the latest round of redundancies will face a truly daunting task. Many are too young to consider leaving the industry (as they feel that they have yet to make their money), and countless others feel that they are simply too long in the tooth to consider doing anything else.
The reality is that many bankers simply appear unable to accept reality - the industry has changed, and the skills acquired by many who spent their careers working in the markets are no longer in demand. Whole parts of the business will simply no longer exist in the brave new world. The death of leverage has resulted in many firms closing or significantly downsizing their prop trading operations, and prop traders and their support staff (trade support, settlements, IT, etc) have been let go in their thousands. The huge scaling-back of the hedge fund industry has also resulted in dramatically less demand for prime brokerage services, and then there's the whole area of asset securitization, which got us into this mess in the first place, where whole departments have been swept away, many never to return. There's also the M&A world, always cyclical in nature, is in danger of seeing deal-flow going back to 1995 levels. 2008, in fact, looks like being a year when the value of cancelled deals actually comes out higher than completed ones!
And this period when the industry is trying to re-invent itself is, of course, coinciding with the greatest period of economic turbulence for decades, and many firms are having to axe staff simply to get their cost-base down. When revenue streams disappear, so do great waves of staff.
All this leaves many financial markets professionals in great difficulty. The first issue that many have to overcome, however, is a mental one. Many bankers just can't seem to appreciate that the old ways are no longer in vogue, and the markets have moved on. 'I was good at my job. Why can't I get another ?', one banker who has been out of work for over 6 months asked Here Is The City. But it's not about whether someone is good at a job anymore - it's about whether those kind of jobs actually exist anymore. Bankers, like coalminers and drivers of horse-drawn carriages before them, need to appreciate that their industry has changed, and many will have to look for alternative ways to make a living.
That's not to say, however, that thousands of laid-off bankers won't eventually get back in a job in the markets - they will. But it will be harder, and many bankers who have been let go in this current downturn will unfortunately never return to the industry.
It's not all doom and gloom, though. And we should all take heart from the example provided by Joshua Persky, the MIT Graduate who, desperate to find a new job after being laid-off by Houlihan Lokey, took to the streets of New York earlier this year with a sandwich board in search of new opportunities. Persky hit the headlines with his novel job-seeking approach, which finally paid off. After 12 months without work, he is back in gainful employment, having recently secured a position as a senior valuations manager with US accounting firm Weiser LLP. Now sandwich boards aren't for everyone (and the success rate for copy-cats is not likely to be good), but Persky demonstrated that only those who are the most determined will succeed in today's employment market - but even he had to take a job on the fringes of the industry. Sending out a few resumes is no longer a viable strategy for getting your career back on track. And those who simply sit back and wait for the phone to ring could be waiting a very long time.
If you have recently lost your job (or feel that that you are in danger of losing it), take some time out to look at your career options. Then be clear, focused, determined and different. And remember - the old ways are gone forever.
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