Who will win when it comes to jobs and pay in 2007?
Debt and disaster are grist to the mill of restructuring advisors. Banks tested the restructuring waters in 2006 and look set to go skinny dipping in 2007. Merrill Lynch, Goldman Sachs, and Morgan Stanley will all be hiring, predicts Neil Mckay, a consultant at search firm Sheffield Haworth. Jim Nairn, a recruiter at Cornell Partnership, says The Blackstone Group will be the one to watch. In early December it pinched Martin Gudgeon, chief executive of Close Brothers Corporate Finance, to head a new restructuring team in Europe.
Structured credit sales:
Rumour has it there will be some 150 structured credit sales vacancies in the City in the New Year. Allowing for a little exaggeration, it seems structured credit is on a roll.
Calyon is said to be hiring an additional 60 people for its credit markets and collateralised debt obligations group. Recruiters also suggest Barclays Capital, BNP Paribas, Calyon, Dresdner Kleinwort, HSBC, Royal Bank of Scotland and Wachovia will all be waving their cheque books in the direction of structured credit sales talent.
"Most businesses will continue upwards," says Simon Clarke, a consultant at derivatives search firm Watmough Mallett. "Our list of three or four clients have all indicated plans to hire in structured credit sales and structuring."
Hedge fund flotations:
Following the FSA's go-ahead for foreign buyout funds and hedge funds to list in London, more and more hedge funds are expected to go public in the City. The regulator is also consulting on whether to make it easier for UK-based firms to list here.
Steven Whittaker, a partner at law firm Simmons & Simmons, says public listings will make it easier for big hedge funds to offer staff equity, and may contribute to recruitment and retention. But he adds that the number of listings is more likely to be a trickle than a flood: "Funds that list will need to have been operating for a few years with an excellent track record and strong brand." That rules out plenty of the smaller funds in London.
Could it be corporate financiers will have an even better 2007 than 2006? Morgan Stanley seems to think so. The US bank is forecasting that European M&A activity will rise on the back of growing equity fund sizes and continuing growth in the credit markets.
One corporate finance headhunter tells us hiring looks set to be robust in the first half of the year, but the final six months will depend on the strength of the market until June. She predicts telecoms, media and technology (TMT) bankers will be in continued demand, as will financial institutions group (FIG) specialists. Lehman Brothers is forecast to remain one of the bigger hirers.
Love it or hate it, 2007 will be the year of the Markets in Financial Institutions Directive (MiFID). Compliance recruiters are predicting a rush of related hiring, much of it low paid.
"Investment firms will potentially have to hire individuals, if not teams of people to classify every new client, as well as looking back historically at current clients," says Ian Morrison at IMS Selection. "It would be a very administrative role, not far off data entry."
The new rules are also likely to spur existing demand for less low-end MiFID-savvy consultants at the likes of the Big Four.