We are entering the dead zone for financial services recruitment. First comes the lull during the summer when key-decision makers are off on vacation, then there’s the final quarter where more thought is given to the requirements for 2016 than filling headcount for this year.
Yet there are still roles that investment banks and other financial services organisations on Wall Street are keen to fill. For now, and the remainder of 2015, you have a much better chance of getting one of the following positions in New York’s financial services sector than any others.
Healthcare M&A activity so far this year has already surpassed the record revenues reached in 2014, with deals worth $395.8bn announced to the end of July. Not surprisingly, it’s the U.S. market that’s been the main beneficiary as larger drug-makers have been buying up smaller rivals.
“Banks have a big need to hire people for their healthcare M&A teams,” says Oliver Hayes, managing principal of recruiters Selby Jennings in New York. “We’re seeing the main demand at associate level one, both on the back of increased deal activity and the exodus of junior bankers to the buy-side creating a shortage.”
Maybe this isn’t a great indication of the state of the economy, but hedge funds with a distressed debt focus are looking to staff up. Primarily, they’re looking for experienced analysts with 8-15 years in the industry, suggests Robin Judson, managing partner and group founder at headhunters Robin Judson Partners in New York.
“This is in anticipation of more credits running into problems over the next 18 months,” she says.
The Fed is reportedly on the cusp of its long-awaited rise in interest rates and investment banks have responded by both hiring rates traders and attempting to lock in their existing staff with pay rises. Expect this to continue for the next few months.
The junior recruitment spree has continued within the IBD functions of large investment banks, principally because private equity firms are getting ever-more savvy at targeting analysts.
Brianne Toole, the investment banking consultant at Selby Jennings in New York, says: “Private equity firms are getting analysts to commit to jobs just six months into their investment banking career – or 18 months before the job is due to start. Investment banks have responded by increasing pay – it will be interesting to see whether this has worked in the coming months.”
Goldman Sachs says that 75% of the people it hired in the second quarter were based in low cost destinations where it houses tech and operations professionals. J.P. Morgan has just shifted tech jobs out of New York City across the river to Jersey. They need people to lead these projects.
“A number of large financial services firms are using this time to upgrade their infrastructures, move to the cloud, consolidate and move out of high-cost, metropolitan areas,” says Anne Crowley, managing director of recruiters Jay Gaines & Company. “Project management skills are being sought to assist with those initiatives. However, individuals need more than just PM skills, they also need relevant domain subject expertise, leadership and runway to grow into other roles at the firm once the project is completed.”
Internal auditors have been in demand across industry in the U.S. for some time now, but competition for talent within the financial services industry has been heating up throughout the course of this year, says Dawn Fay, district president, Robert Half in New York.
“There is intense demand – and great competition – for internal auditors among financial services firms, which need to strengthen their internal controls and document processes to meet regulatory mandates,” she says. “Institutions frequently want to hire auditors who have been with a reputable accounting firm and either served financial services clients or also have experience working in the financial sector.”
The compliance hiring train continues unabated – HSBC has taken on over 2,000 compliance staff this year alone, for example – but while demand for KYC, surveillance and AML professionals remains high, banks still need new compliance hires to interpret evolving and vague requirements from regulators.
“Regulators are not necessarily prescriptive in how firms should respond to new regulation, so figuring it out takes analysis and effort on the part of the financial institution,” says Crawley.
“Financial services firms seek compliance professionals who can help them meet evolving regulatory mandates, especially in areas such as consumer protection, AML and KYC,” says Fay.
J.P. Morgan is doubling its spent on cyber-security and accelerated the timeline to 2017. Banks generally have hired thousands here, hiring former intelligence officials from the CIA and MI5, as well bringing in ethical hackers to test the robustness of their systems. This is showing no signs of abating.
“Technology in general, but specifically in cyber-security and analytics-security of private customer information and analytics to target customers is very much in demand,” says Jeanne Branthover, managing partner and head of the global financial services practice at Boyden Executive Search in New York.
It’s not just distressed hedge funds that are building up in the U.S., the more traditional long-short equity funds are also looking to bring in analysts, says Judson.
“This is down to continued investment opportunities in the equity markets paired with the need be able to identify and take advantage of weaknesses in both specific names and in the overall markets,” she says.
As investment banks look to making their operations functions ever-more efficient, it’s not the rank and file operations professionals who are in demand, but more those able to manage projects, says Peter Laughter, CEO of recruiters Wall Street Services.
“We are seeing a renewed demand for trade operations professionals as well as project management expertise with various trading platforms. This is the trend we expect to continue and accelerate,” he says.
Like cyber-security, Big Data is the tech skill of the moment and banks, asset management firms and hedge funds alike are all looking to bring in expertise.
“Big data or data analytics is an active area, as firms use their large arsenals of data for regulatory scrutiny and reporting as well as for competitive analysis and advantage,” says Crawley. “Asset management firms are also constantly looking for new ways of reflecting and differentiating performance. Data analytics is very important to that.”
Banks are still hiring risk managers across financial services globally and Wall Street is, of course, no exception. Fay says risk managers are in demand across the board: “With the heightened attention and pressure on the types and level of risk at organizations, institutions need professionals in areas ranging from credit and operational risk to information technology risk. Firms are managing – and will continue to manage – a heavy volume of activity in this area.”
However, Crawley says there’s a been a shift recently: “We see greater emphasis on enterprise and operational risk management roles vs. market and credit risk which, while still active, are less of a trend.”