As mentioned last week, the threat of redundancy appears to be receding. With the exception of Commerzbank, which has indicated that it will make even more redundancies than planned at Dresdner K, and UBS, which has announced plans to cut another 2,500 investment banking jobs before the end of this year, most banks are busy implementing existing cost reduction programmes rather than announcing new ones. And Lloyd Blankfein has indicated that there will probably be no more redundancies at Goldman Sachs.
Nevertheless, if you are of a nervous disposition there are still some jobs that carry a lower risk of layoff than others. And they, in our opinion, are –
1. Equity flow sales
Although equity commissions were down around 40% year on year in the first quarter according to Thomson Extel, equity flow business remains a strategic priority for many banks. Barclays Capital is on an equities hiring drive. So is Evolution. So is Nomura, and so are ICAP, Jefferies and Unicredit.
All of this means that if you work in equity sales (or equity research), you’re probably ok. “All areas in equities are holding up. If you look at commission pools as a whole, they are not that fantastic in cash equities, but there are so many new entrants to the market that it’s leading to an appetite for good people,” says Alex Williams, a consultant at search firm Pelham International.
2. Data vendors
Events of the past two years have highlighted the need for objective information in order to price very infrequently traded financial products. Such products may be less prevalent in future, but there are still plenty of them from the past.
For this reason, companies such as Markit, whose raison d’etre is the valuation of all things illiquid, are doing rather well. Markit is currently advertising 23 jobs in the UK and is most probably not eliminating people at the same time.
3. The FSA
The UK Financial Services Authority isn’t averse to staff removal. Between 2005 and 2008 it cut its enforcement and supervisory people by 17%. It’s now engaged in a programme of upgrading.
If you are still working at the FSA now, or if you join in the next few months, your future is likely to be secure. A spokesman for the regulator says he’s “not aware of any future plans for redundancies.” He also said that most of the additional staff have now been taken on.
4. FX sales and trading
FX teams are not immune to redundancies – UBS and Bank of America/Merrill Lynch have made cuts this year according to recruiters. But with FX businesses having an impressive first quarter, FX is the place to be.
“There haven’t been huge amounts of redundancies in comparison to other areas and there is still hiring going on to some degree. FX is holding up ok,” says Neil Price at FX recruiter Michael Williams Associates.
5. FIG M&A
With financial services M&A accounting for 25% of announced deals globally in the first quarter according to Thomson Reuters, financial institutions group (FIG) bankers have been busy. Senior FIG dealmakers are popular, Deutsche Bank hired 12 ex-Merrill FIG bankers in January and Basil Geoghegan, a Goldman FIG banker in April.
“FIG is very buoyant, so banks’ FIG coverage people are very secure,” says the head of investment banking at one London search firm.
Although risk and compliance teams have been hit by trader redundancies and falling volumes in equities and structured products, jobs in both areas are largely secure.
“In credit derivatives and structured finance, there is a need to review models. Banks either need people in-house to work on this, or they need to hire in consultants,” says Priya Mariannie at recruiters PSD Group. “Credit risk jobs are the most secure,” she adds. “Credit risk analysts are needed to analyse counterparties and transactions. They are busy and getting busier.”