OK, so ‘huge’ hiring may be a misnomer – despite promising early indications that 2014 was going to be a big year for jobs in finance, it hasn’t really come to much so far.
Financial services headhunters in London are not filled with ebullience. “Line managers have the desire to hire, but recruitment in banks is being very constrained by headcount restrictions imposed by the HR department,” says Simon Head, head of global markets and front office recruitment at search firm Correlate. “There are more approval processes to go through than ever before and the time from a verbal offer to an offer letter can be three or four months. That’s what’s slowing down the volume.”
Nonetheless, there are some areas where front office finance jobs are more plentiful than others. They are as follows:
1. Equities hedge funds – portfolio managers and analysts
Although global macro and emerging markets hedge funds are having a bad year, the same doesn’t apply to equities hedge funds. Michael Karp, chief executive of search firm Options Group, says equities hedge funds are some of this year’s biggest hirers so far. “They’re recruiting analysts and portfolio managers,” says Karp. In London, Crispin Odey has been adding researchers from banks, for example.
2. Equity research
Equity researchers are also having a good start to 2014. As we noted a few weeks ago, the best among them are finding their talents sought by hedge funds which are suddenly interested in investing on a sectoral basis. Banks have been hiring equity researchers too. Citi has been losing equity researchers and hiring more in. Bank of America is also known to have recruited several equity researchers already this year. It’s not exactly huge, but it’s growing and equity research hiring has the potential to pick up further as the European IPO pipeline continues to phut out deals.
3. Prime services and prime brokerage
Head says prime brokerage and more broadly prime services are also areas of above normal activity in 2014 as banks continue to vie for hedge fund clients. JPMorgan has said it’s building its prime broking platform in Asia. Bank of America’s prime broking business is likely to be in a state of instability following last month’s departure of 55-year-old Stuart Hendel who had built the business for the bank since 2011. Other banks can be expected to take advantage of this.
4. Electronic trading
Speak to anyone who recruits for financial markets, and they will say that electronic trading is hot. Banks are seeking to automate far more of their fixed income trading platforms and to continue the automation of equities trading businesses. JPMorgan in particular is expected to expand its electronic equities trading platform this year (although is not expected to hire in the process).
“Electronic trading is still a very busy space – we are seeing a lot more roles coming through from the banks,” says David Robinson, senior consultant at Riversdale Consulting. “There are a lot more sales roles, a lot more very senior product and quant roles. There are more on-boarding roles – there is just demand for good strong electronic product people.”
Credit sales and trading professionals are thought to have had a good start to the year – revenues in the area are up around 14% across the market according to analysts at Morgan Stanley. “Credit could be a market for this year,” says Head. “There are a couple of banks that want to grow credit sales and we’re already seeing more activity here.”
6. Junior M&A roles
Finally, 2014 has started with a well-documented increase in demand for M&A professionals with a few years’ experience. Recruiters in London attribute the uptick to banks’ failure to recruit sufficient graduates in 2010-2011, combined with banks’ attempts to restrict young bankers’ working hours.