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Wall St. Hiring
By NELSON D. SCHWARTZ
While much of the country remains fixated on the bleak employment picture, hiring is beginning to pick up in the place that led the economy into recession — Wall Street.
The shift underscores the remarkable recovery of the biggest banks and brokerage firms since Washington rescued them in the fall of 2008, and follows the huge rebound in profits for members of the New York Stock Exchange, which totaled $61.4 billion in 2009, the most ever. Since employment bottomed out in February, New York securities firms have added nearly 2,000 jobs, a trend that is also playing out nationwide at financial companies, commodity contract traders and investment firms.
Though the figures are small in comparison to overall Wall Street employment, executives, economists and headhunters say they expect the growth to pick up steam in the coming months.
“I think we’re seeing some hiring in anticipation of better times,” said Rae Rosen, a regional economist at the Federal Reserve Bank of New York.
The increase in hiring and cautious optimism stand in sharp contrast to the mood among workers in other fields, where jobs have been slow to return or are disappearing altogether. Since June 2008 the number of jobs has shrunk by nearly 14 percent in manufacturing and by 22 percent in construction, but only by 8.5 percent in the financial industry nationwide.
It is also the opposite of what is going in other highly paid, white-collar professions like law, where employment nationwide in June was the lowest since late 2001, according to data from the Bureau of Labor Statistics.
The financial work force in New York has shrunk by more than 28,000 since its peak in January 2008, but is still slightly above its level in 2003 after the tech bubble burst, meaning it actually weathered this recession — the worst since the Depression — better than the previous one. Nationally, staffing is back to where it was in late 2005, while employment in the overall economy is near 2004 levels.
As hiring has picked up on Wall Street, salary packages recalling the boom years are reappearing at the most senior levels. Richard Stein, president of Global Sage, an executive search firm, said corporate clients had offered compensation packages worth more than $1 million annually to 12 candidates in recent weeks.
“The offers are not near where they were in 2006, but there is still a war for talent,” he said. “Everyone thought the ice age had returned, but the thaw has come and we’re in catch-up mode.”
The hiring is not just a local phenomenon. Major investment banks are quietly rebuilding their global work forces.
Goldman Sachs added 600 jobs worldwide in the first quarter, while JPMorgan’s investment bank has hired slightly more than 2,000 people globally since the beginning of the year.
Closer to home, Credit Suisse’s investment bank, based in New York, filled 600 positions in the first quarter, with a significant portion in New York. Deutsche Bank has hired 414 people in New York, including 98 directors and managing directors since the start of the year.
Hiring is also picking up at boutique firms and at smaller foreign banks seeking a beachhead in New York.
Nomura of Japan has been especially aggressive, recently hiring several top bankers from Deutsche Bank. Nomura’s New York-based securities unit has increased its staff to more than 1,700, from 1,000 in March 2009, and the bank says it will hire 300 more workers by March 2011.
Macquarie, an Australian investment bank, has also rapidly expanded, even taking over new floors in its Midtown Manhattan headquarters to accommodate new trading operations. One morning last week, long rows of traders there worked the phones and watched a multitude of screens, evoking the heady days before the Bear Stearns and Lehman Brothers downfalls.
“We are very bullish on the U.S.,” said Tim Bishop, who leads Macquarie’s United States operations.
On Thursday, Macquarie added six fixed-income traders in New York, and it plans to announce the hiring of six equity traders on Monday.
As the nascent increase in jobs suggests, the recovery is still very fragile. And executives say it could halt or even reverse if earnings reports for the second quarter, which begin this week, are disappointing.
As a result, some banks are hiring in stages, with one eye on the economy. In recent months, Morgan Stanley has hired 100 private bankers in the United States to serve wealthy clients but is holding off on plans to hire 400 more, waiting to see how the market performs.
Still, top banks and brokerages remain well aware of their reputation for taking reckless risks in the pursuit of profits, and they insist they are not simply reanimating the trading desks and other brash operations that caused the problem in the first place.
FIRE's Rorschach Test
The shift underscores the remarkable recovery of the biggest banks and brokerage firms since Washington rescued them in the fall of 2008, and follows the huge rebound in profits for members of the New York Stock Exchange, which totaled $61.4 billion in 2009, the most ever. Since employment bottomed out in February, New York securities firms have added nearly 2,000 jobs, a trend that is also playing out nationwide at financial companies, commodity contract traders and investment firms.
Though the figures are small in comparison to overall Wall Street employment, executives, economists and headhunters say they expect the growth to pick up steam in the coming months.
“I think we’re seeing some hiring in anticipation of better times,” said Rae Rosen, a regional economist at the Federal Reserve Bank of New York.
The increase in hiring and cautious optimism stand in sharp contrast to the mood among workers in other fields, where jobs have been slow to return or are disappearing altogether. Since June 2008 the number of jobs has shrunk by nearly 14 percent in manufacturing and by 22 percent in construction, but only by 8.5 percent in the financial industry nationwide.
It is also the opposite of what is going in other highly paid, white-collar professions like law, where employment nationwide in June was the lowest since late 2001, according to data from the Bureau of Labor Statistics.
The financial work force in New York has shrunk by more than 28,000 since its peak in January 2008, but is still slightly above its level in 2003 after the tech bubble burst, meaning it actually weathered this recession — the worst since the Depression — better than the previous one. Nationally, staffing is back to where it was in late 2005, while employment in the overall economy is near 2004 levels.
As hiring has picked up on Wall Street, salary packages recalling the boom years are reappearing at the most senior levels. Richard Stein, president of Global Sage, an executive search firm, said corporate clients had offered compensation packages worth more than $1 million annually to 12 candidates in recent weeks.
“The offers are not near where they were in 2006, but there is still a war for talent,” he said. “Everyone thought the ice age had returned, but the thaw has come and we’re in catch-up mode.”
The hiring is not just a local phenomenon. Major investment banks are quietly rebuilding their global work forces.
Goldman Sachs added 600 jobs worldwide in the first quarter, while JPMorgan’s investment bank has hired slightly more than 2,000 people globally since the beginning of the year.
Closer to home, Credit Suisse’s investment bank, based in New York, filled 600 positions in the first quarter, with a significant portion in New York. Deutsche Bank has hired 414 people in New York, including 98 directors and managing directors since the start of the year.
Hiring is also picking up at boutique firms and at smaller foreign banks seeking a beachhead in New York.
Nomura of Japan has been especially aggressive, recently hiring several top bankers from Deutsche Bank. Nomura’s New York-based securities unit has increased its staff to more than 1,700, from 1,000 in March 2009, and the bank says it will hire 300 more workers by March 2011.
Macquarie, an Australian investment bank, has also rapidly expanded, even taking over new floors in its Midtown Manhattan headquarters to accommodate new trading operations. One morning last week, long rows of traders there worked the phones and watched a multitude of screens, evoking the heady days before the Bear Stearns and Lehman Brothers downfalls.
“We are very bullish on the U.S.,” said Tim Bishop, who leads Macquarie’s United States operations.
On Thursday, Macquarie added six fixed-income traders in New York, and it plans to announce the hiring of six equity traders on Monday.
As the nascent increase in jobs suggests, the recovery is still very fragile. And executives say it could halt or even reverse if earnings reports for the second quarter, which begin this week, are disappointing.
As a result, some banks are hiring in stages, with one eye on the economy. In recent months, Morgan Stanley has hired 100 private bankers in the United States to serve wealthy clients but is holding off on plans to hire 400 more, waiting to see how the market performs.
Still, top banks and brokerages remain well aware of their reputation for taking reckless risks in the pursuit of profits, and they insist they are not simply reanimating the trading desks and other brash operations that caused the problem in the first place.
FIRE's Rorschach Test
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