What to Expect When You're Expecting
Much of us, particularly in the last few years have seen this, a co-workers phone rings, they get up walk off and never come back. Or maybe someone from HR taps them on the shoulder and walks them to the gallows.
It looks like Wall Street is about to get washed with another wave of cuts. GS announced another round, as did CS. I don't believe UBS has, but they can't even get the people they want working there to stay. That being the case thought I'd drop a couple of rnadom nuggets of lay off wisdom to shed some light on the topic and let you know how you can best avoid it.
First off, there's usually a buzz circulating as to when it will actually happen. Accordingly, most people on the floor know which week its going to be. This has been said before, and I'll repeat it, once you're let go verbally you are generally not even permitted to go back to your desk. On D-day, there are abandoned half-eaten turkey sandwiches abound. Someone from HR will usually come back and grab immediate personal belongings (cell phone, coat and keys). So the best course of action is, no matter how secure you may feel, condense your belongings. Clean out your desk. Keep important personal items all in one place, preferably in a bag.
Second, this is pretty well known but if you're in a promo class (i.e. up for promotion at the end of the coming year) you're ripe to drop off the tree. You'll get more expensive next year and if they fire you now and retain that new first year, they're just maintaining status quo cost effective junior labor.
Third, usually no one is safe. Newly minted analysts often have the view that they are safe. You may feel that because they just hired you X month(s) ago, why would they fire you. They would have just not hired you. But usually there's a number that is to be hit. And when they cut the obvious underperformers or those in industry/product groups that are in a lull, they start ticking off more names... usually inconsequential (i.e. junior) staff members.
Fourth, the dynamics of your group make a big difference. Ideally, you'd want to be in a large revenue, low head-count group. They can't really afford to cut the sole analyst or associate from a team. It obviously helps to be the top ranked analyst/associate/VP, but depending on how bloated your group may be and how deep to the bone they're cutting, you could still get axed. You also want to be in a group integral to the franchise of your firm. Being staffed up doesn't mean you're not going to get axed.
Fifth, your friends will get fired. You will be joking around about when the cuts will be coming one day and the very next day, that person will be the one getting axed. Thats just the way this business works. You could very well be that person getting axed, so if it is a friend getting fired... don't feel too bad, just be happy its not you.
Sixth, if you can't come up with a few reasons why they HAVE to keep you, you're defintiely in contention for getting fired. In this business, even if you're an all-star there are no guarentees. If you're an ok performer, there is absoluteley a red pen grazing across your name on a list deciding when and where to stop like a roulette wheel. Do yourself a favor and make sure you're at the very top of your class. And FYI, the fact that you're super-staffed does not mean you're safe. You're completely expendible, your dead corpse will be rolled off the edge of the boat and the next slave will grab your oar.
Lastly, much like getting hired on Wall Street... there is a fair degree of chance involved. First they scratch "strategic re-alignments"... i.e. scaling back whole groups significantly because they either don't think it is important to the franchise or they don't think the current market is an opportune one in this particular industry verticle/product. They also scratch all the obvious underperformers. Then they crunch the numbers, see how much more weight they still need to drop and then they start scanning the list of names/titles/comp numbers to see who else can be dropped. Which group can be leaner? Which class is overweight? What are the politics? Which group heads are high powered in the organization (although this doesn't neccessarily mean they're going to make sure their group isn't touched). Keep in mind, from a group head perspective, he's got a P&L to manage. Does he want an army of junior bankers eating away at it?