Last Friday, Forbes.com reported that 117,639 have been or are scheduled to be lost from 500 of the largest companies in the United States, including General Motors, which plans to cut 47,000 jobs; Caterpillar, which cut 22,000 jobs and PNC Financial Services Group, which plans to cut 5,800 jobs. Of course, the banking and financial services sector has been shedding jobs at an alarming rate since 2007. The banking crisis, which includes the failures of the investment banking giants and the concomitant mergers of large financial institutions, has contributed to a flooding of the tight job market with talent.
According to Steve Candland, Managing Partner of Advantage Integrated Talent Services, “generalist junior investment bankers” – people who are only a couple of years into career at professional level – are having the most difficult time in the current job market. “Also, on the capital market side, credit default swaps, which was a fast growing area just a year ago, has seen a steep drop as well.”
But is it all doom and gloom out there?
Not completely, according to Morgan Kavanagh of Huxley Associates, a recruitment firm that focuses on Finance, Global Markets, Banking Technology, and IT, among other areas. “I think it’s fair to say that this is a very challenging environment in which to be seeking a job, particularly in the banking sector, where there is such uncertainty about the future at the moment. There are, however, some areas where there is still relatively strong demand for the highest quality candidates.”
And there is a silver lining. The mass exodus from the large financial institutions and existing hedge funds has even, in some cases, created jobs according to Candland. “If you are a talented person and know other talented people and are downsized, you are thinking about how can start own company. Bankers and traders are getting together to form new companies to explore new niches, whether in capital raising or distressed investing or reorganization.”
“Emerging out of the hedge fund industry are early signs of a revival,” said Candland, “There are employment opportunities now and select individuals will find they’re in for an exciting time. New funds are forming daily due to senior members leaving their current fund to start and head their own. As the market turns, the top funds that have been decimated in the last 12 months will grow regardless of recent pessimism. Hedge fund practitioners are clear of one thing: what hasn’t killed them will only make them stronger.”
Candland and Kavanagh both agree that highly qualified quantitative candidates are currently in demand. Says Candland, “My recent focus and success has been within the quantitative hedge funds and I see growth in all aspects in this arena such as: quantitative modeling & development, algorithmic trading & execution and statistical arbitrage.” Similarly, Kavanagh sees growing demand in areas such as “risk management – particularly quantitative risk management; quantitative trading strategists with a strongly profitable track record; and technologists with strong knowledge and experience of trading and risk management systems.”
Candland continues, “Interestingly, the demand for quantitative people extends to related industries in finance. The credit card issuers they are all having high demand for quant model because of risk adjusted scenarios – spending a lot of time doing new projections concerning default rates, profitability. They do modeling to get ahead of risks. Insurance companies are using quant people too.”
There are other opportunities in the financial sector as well. “As Obama outlined in his speech last night, credit is the lifeblood of the economy…credit analysts are in demand for obvious reasons,” says Nicki Gilmour, CEO of Evolved People Media, the parent company of TheGlassHammer.com. She adds, “The good news is there are jobs at various levels of seniority and in various firms analyzing various industries.” For example, Pimco is looking for credit analysts with experience in four different sectors- distressed debt, financial, utilities and retail. UBS is looking to hire a Credit Officer to perform credit analyses on UBS IB existing and proposed credit counterparties encompassing financial institutions (i.e., banks, brokers, clearinghouses, FCMs).
In other words – fear not. There are opportunities, even in the current economy, to find your dream job in the financial sector, especially if you are a candidate with top quantitative skills.