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Headhunting chief execs call the hiring market for 2009

Want to know what’s going to happen next year? Here’s the outlook from seven senior executives at financial services search firms.

Jonathan Baines, chairman Whitehead Mann

“The financial services industry is going through a generational change. Most organisations, however well or badly they have done, are now in the process of reviewing their business models and questioning which areas they should and shouldn’t be in. Until this fundamental review is out of the way and the industry has been through the necessary adjustment, there will be little significant hiring. Only once this has been completed will we know what the future holds, and with the regulatory landscape still unclear this is most unlikely before the second or third quarter of 2009.”

Shaun Springer, chief executive officer, Napier Scott

“Areas of banking which suffered in 2008 will suffer further in 2009, and areas which actively hired in the past 12 months will continue to be active next year. Businesses which have suffered the most, like leveraged finance and securitization, will not come back. Other areas, such as the Middle Eastern private equity and global private banking will continue to be an area of focus. Once banking regulation has been clarified, I would also expect a lot more hiring in operations and risk management.”

Brian Hamill, chairman, Redgrave Partners

“Having faced unprecedented market conditions throughout much of 2008, I believe that 2009 will be an extremely difficult year. Capital markets and M&A are areas which are likely to remain very depressed, with the expectation that widespread redundancies are more likely than any notable hiring plans. In terms of other areas, both hedge funds and private equity firms face difficulties in terms of both redemptions and problem portfolio companies, which are likely to lead to staff being shed. A few bright spots are evident, with the possible exception of selective hiring by private wealth managers and advisory boutiques. One area which is likely to benefit from the market turmoil is restructuring where there is actually a dearth of talent.”

Michael Karp, chief executive, Options Group

“The first two quarters of 2009 will be pretty similar to the last quarter of 2008, when there was not much hiring activity. The whole globe is in a recession and this is not going to change quickly. Overall, I expect hiring to be even less in 2009 – banks will be cautious about adding headcount when they are also laying off thousands of people. However, they will always remain interested in good talent. Areas which might be active include rates, FX and commodities. Geographically, I think the Middle East should be active. Equities hiring also remains active within the UK.”

Tim Sheffield, chief executive, Sheffield Haworth

“Overall, 2009 will most likely be a much worse year for the UK financial services executive search industry. The first quarter of 2009 will continue to see further redundancies and there will be very few new hires until the dust settles. Most large financial services organizations are still significantly over-staffed to deal with the expected lack of business in 2009. Expect further cuts in the New Year. What little hiring there is will primarily be dominated by the more regional or specialist firms who see this as an opportunity to pick up talent at affordable prices. In one or two exceptional cases, you will see large investment banks gradually build up their global equities and corporate finance business. This is based on a longer term build-out over two to three years. It is impossible to predict beyond the first quarter but we do hope that towards the autumn, there will be more positive signs appearing. Areas where we see continued hiring include equity research and sales, restructuring and M&A advisory, strategy, private banking and asset management. Senior bankers who have strong client relationships will continue to receive calls. ”

Dee Symons, co-head of European financial services, Russell Reynolds

“2009 is going to be a much tougher than 2008. Headcount will continue to shrink. Banks are heading back to 2003 levels in terms of revenues and bodies, so there is still a way to go and more redundancies are expected in Q1.

Recruitment will be largely very senior level strategic hiring and opportunistic upgrading to take advantage of the dislocation. Certain areas will, however, continue to grow (some of this will be dependent on the needs of the bank). FIG and restructuring are two key areas in which we expect growth in banking. In markets, the traditional flow areas of rates, fx are likely to grow. Risk and other group functions (finance, compliance etc.) will also remain requirements.”

Lee Thacker, partner, Silvermine Partners

“Headcount cuts are gaining momentum. Management are cognisant of a massive contraction in activity levels, leading to planned reductions of 30-50% of front office headcount, especially in those firms where a government re-capitalisation is in place.

We expect headcount cuts to continue across all lending, capital markets and trading and sales product areas in the first quarter of 2009. Commercial banks operating on a March bonus round can be expected to follow US banks in implementing deeper cuts as the bonus payout date approaches.

The fundamental lack of confidence in new business levels will see some radical cuts through 2009. Clients are not yet saying they are able to plan for any turnaround or restart of business levels and remain supremely cautious on adding any new headcount.

The most concerning trend to emerge in December has been the wholesale withdrawal by certain firms from areas like securitization, leveraged finance, and hybrid capital.

We expect some improvement in the hedge funds sector as 2009 progresses and corporate defaults in the UK and Europe accelerate. But staffing demand remains thin.

We expect broker dealers to continue to pick up sales and trading staff at low cost levels. Investment banking is expected to staff-up on corporate restructuring and legal skills through 2009. New boutique start-ups in advisory are also expected to add staff, as are private equity funds which need debt-aware professionals.

With some optimism, we are hopeful of seeing some stabilisation of business levels due to refinancing needs during the second and third quarters. At this point, staffing levels may be able to stabilise.”

Comments (30)

Comments
  1. How do u guys think about infrastructure? Would this create opportunities for infrastructure related lending, securitization, advisory, M&A and private equity as all countries push into investments in infrastructure?

  2. remarkably sensible commentaries by our cv pushing friends tho i am afraid that the market picture looks even bleaker than they suggest.As to the comments re Mid East hiring..i continue to expect the young and the newly divorced that have unfortunately lost their jobs to continue to head that way…but do be careful..once you take that route there is little chance of coming back

    Longinthetooth Reply
     
  3. Outstanding article, Sarah. Thank you very much.

    Rodolphe Mortreuil, MKMC Reply
     
  4. I can see why these guys are in recruitment. Oil at 30 dollars spells bankruptcy for many an Arab nation. The Middle East certainly won’t be a hot area next year except for the weather.
    Thanks to the timely interventions and stimulus packages by our politicians there will be no recovery anytime soon. If you copy Hoover and Roosevelt you can turn a garden variety crisis into a depression unlike 1921, 1981, 1947 etc.

  5. Sarah – how about a view from a change management headhunter ? Comments above are very front office focussed and as I have said before, the Regulators will be key in the initiation of hiring recovery in the change management world.

  6. The article is way too long, please could you ask BB senior MD’s for a list of products/teams which are going to do well in 2009/2010 and will see more recruitment? This article is useless, not to the point and compiled by HR who know nothing

    e.g.
    ECM, rights issues nordic coverage
    DCM, corporate coverage Italy
    FX sales UK
    M&A Energy & Gas, EMEA
    ALM for pension funds EMEA

  7. MBA you sound too desperate..use the above comments as guidance and then do your own research..dont hope to be spoonfed about where to go for a job
    For what its worth..my view
    ECM Nordic good
    DCM Coverage Italy good
    fx sales uk poor
    M&A eNERGY AND gAS emea DEAD
    ALM PENSION FUNDS poor

  8. Obviously as MBA grad I don’t have access to intelligence as BB Senior MD’s who know what’s going on and see the P&L and know the needs of teams and clients combined

    Those were just an example…

  9. MBA. The article is too long, you’re right, but more people than expected were keen to comment. Although the respondents aren’t bankers, they’re all senior headhunters (not CV pushers) and are in contact with heads of businesses at banks. They are therefore qualified to comment on what they expect for next year.

    Sarah, Editor, eFinancialCareers Reply
     
  10. Bar one, the above people are definately plugged into the correct professionals to provide opinons on 09 hiring appetite. Its not a pretty outlook – however banks always want to make money and consequently will hire in 09. It will be about differentiation….more losers than winners is envitable.

  11. Yeah fine, I agree Sarah, but think about your audience and the added value. Everything in the article I know by reading the newspaper, restructuring is booming, fx sales does well , job cuts in Middle East/ Asia etc….but your job is not to produce a number of articles only.. think about the added value.. how are you able to attract more people to efinancialcareers such that more headhunters will use efinancials and more firms will use it and pay efinancials an advertising fee….the only way to do that is to add value. I want to know which banks are recruiting for which teams specifically in 2009/2010 and where the chances to get fired are minimal in these turbulent times..

    Think about how you can add value to your employer and justify your job!

    Now please compile a short to the point list with bullet points in the way I suggested about which teams what products what countries are going to be strong in 2009/2010, much more usefull Sarah!

    The article itself in current form has no value added.

  12. MBA: Strangely enough, we already have something like that planned. We’ll publish an article with bullet points reviewing hot/cold hiring areas in 2008 on Christmas Eve, followed by something similar for 2009 on New Year’s Day. Trust you can wait that long.

    Sarah, Editor, eFinancialCareers Reply
     
  13. Excellent ! Great!! Keep up the good work!!! Yeah!

  14. Thanks.

    Sarah, Editor, eFinancialCareers Reply
     
  15. We really enjoy being told that we are too vague and generally rubbish at projecting market intelligence….

    Sarah, please can you publish an article on ‘How to annoy a Headhunter’ MBA seems a likely candidate write such a story…

    Cracking job Sarah – you recovered from the critics with a measured and modest response.

  16. MBA … did your MBA teach you anything ? Other than of course how to over use a tired and out of date cliche. Instead of hanging around job boards hoping someone will tell you where to send your cv, why don’t you do some of your own research and try to do some networking in the real world.

  17. does MBA really expect us to give him a list of firms and teams to approach directly?

  18. Good job, Sarah.

    With MBA’s attitude and manner of putting his points across, I wonder how he is going to get any form of employment especially in this market environment.

  19. MBA, would you like to borrow my crystal ball to see exactly what is going to be happening in 2009/2010 – will send to your home address as i’m guessing from the under tone of your comments you’re clearly on the brink of unemployment, if not unemployed already!…

    SERIOUSLY – get a grip!

    Sarah – to echo the majority, great job!

  20. MBA should get a life. Why should she need to justify her job (!!!) when you’re spending so much of your time on her website?

    Loser.

  21. Sarah, your information is always warmly recieved. MBA, I suggest you learn some manners and then you might, just might, dig yourself out of the financial hole that your MBA has no doubt dropped you in.

  22. The worst thing of all (if you read between the lines), MBA is trying his best to come across as smart and analytical but ends up sounding like a desperate, wannabee, show-off moron.

    Qualification counts for little, in my own opinion, of people’s intelligence. It is the ad-hoc conversations on issues I have with them that I base my judgement of their intelligence on.

    MBA qualification or no MBA qualification, MBA does not come across has someone I regard as smart or worthy of a top profile job.

  23. oh my god is it you the nigerian again.. please keep your mouth shut

    and for all you guys, read carefully my points, nobody is benefitting from vagueness…

    typically british/american style, all pretending to be nice and friendly but are crap… , I might be blunt with my points but they are to the point and precise and intended as constructive feedback

  24. Headhunter, I think u are one of that firm we all know the name from with unethical cowboys and fake jobs so please shut up and be to the point. Obviously the HR guys mentioned in the article won’t give bullet points and any other information what is already known and published in newspapers to cover their ass and hide behind long sentences with no added information at all hence the suggestion ask BB senior MD directly.

  25. One upside of the current financial crisis is that obnoxious posters like ‘MBA’ will no longer slip through the net. What’s so ridiculous is that he seems to think his comments are smart.

    Sarah – to reiterate what the others said – very useful synopsis. Keep it up.

  26. corp sales – you are a fool:
    “ALM PENSION FUNDS poor”
    is equivalent to saying”vanilla rate sales” poor in 2009. flow desks, which support good inflation houses for UK have made a killing this year. constant rehedging and increasing new business into LDI funds, eventual implementation of IFRS phase II and impacts for the small insurance companies will mean an increase in demand for long duration swaps. margins on 30y-50y are large going into 2009, with rate houses restricted banks will concentrate on alm type sales and doing large vanilla volume. i can write an essay on how little you know.

  27. back to the article…how do you guys see Equity Research in 2009? thanks

  28. MBA – do you really think a pathetic attempt at dismissing my firm and calling me a cowboy is an intelligent reaction to the mail myself and the others have been sending?

    I have been told similar things like that for the last 10 years everyday. You being very generalistic… Please can you right something that will ‘ADD Value’?

    I need clear bullet points of what you actually think of Headhunters – especially me. Think of your audience MBA… are these comments really ‘ADDING VALUE’…

    Merry Xmas

  29. Agree with Daniel. Let’s just ignore MBA here and revert back to one of the areas mentioned in recruitments’ comments: Equity Research being a potential of area of hiring. Could we elaborate on that a bit more please?

  30. As a headhunter with over 12 years experience i completely agree with all of the comments posted by my knowledgeable peers within the search industry and this is a useful and accurate article. To answer the question raised by one commentator i think equity research is a possible option for 2009 but more so on the basis of it being a sector where cuts were undertaken some time ago, possibly overly so and clealryb not all coverage sectors are booming to say the least. Of course the other benefit of equity research is the ability to transfer this to some extent to the buy side, albeit not to previous levels. For us the main area of current activity is definitely asset management, particularly in specialist companies, also senior operational roles in niches such as family offices. 2009 will be a testing year with upheavals and undoubted restructuring of regulatory frameworks with the appalling impotent SEC FSA and other so called watchdogs needeing to be revamped, as started yesterday with new senior appointments. Reg and compliance are accordingly obvious likely hot areas for hiring. As for hedge funds well lets just say sadly they are right there with the car industry, its over!

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