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Analyst Layoffs

bbanalyst's picture
Rank: Monkey | banana points 53

There has been a lot of talk about IB layoffs lately. Anyone know if any of the banks have layed off analysts anywhere?

Citigroup or Bear Stearns or Bank of America? (As those are the three I have heard most Investment Banking layoffs have taken place.)

Comments (237)

Dec 3, 2007

Why fire people that have a net cost of about 150K inclusive of bonus, salary, FICA/FUTA/SUTA/401K...

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Dec 3, 2007

Because it saves money and whenever bankers are laid off, it all trickles down b/c you won't need as many analysts to support the remaining ones.

Dec 3, 2007

you're wrong... keeping around a little low paying 'fat' is in the bank's interest.

Dec 3, 2007

Assuming everyone is an average performer associates are fired first, followed by VPs and analysts and finally the senior ranks. Associates are the intermediaries between the junior and senior ranks and the firs to go. Analysts are then expected to deal directly with their VPs and MDs, which can be more difficult but cost effective.

While this is the policy in most banks, only in extremely bad times does this occur. Underperformers will usually be picked out from all ranks first, and only after will mass purges occur.

An interesting consequence to the current market softness will be the size of analyst classes next summer, both FT and SA. The size each bank chooses will show their confidence in their future. Also, it will be interesting to see if any banks try not to honor the kids who have signed with them already. I heard BOA hired too many FT analysts from the intern ranks in 2006 and gave some the option (and 30K) to delay starting FT until 2008. Now that they are cutting their IBD ranks and have this years interns and last years holdovers, it will be interesting to see what they do.

Dec 3, 2007
I-banker2007:

Assuming everyone is an average performer associates are fired first, followed by VPs and analysts and finally the senior ranks. Associates are the intermediaries between the junior and senior ranks and the firs to go. Analysts are then expected to deal directly with their VPs and MDs, which can be more difficult but cost effective.

While this is the policy in most banks, only in extremely bad times does this occur. Underperformers will usually be picked out from all ranks first, and only after will mass purges occur.

An interesting consequence to the current market softness will be the size of analyst classes next summer, both FT and SA. The size each bank chooses will show their confidence in their future. Also, it will be interesting to see if any banks try not to honor the kids who have signed with them already. I heard BOA hired too many FT analysts from the intern ranks in 2006 and gave some the option (and 30K) to delay starting FT until 2008. Now that they are cutting their IBD ranks and have this years interns and last years holdovers, it will be interesting to see what they do.

That is an interesting perspective ibanker. Do you think confidence will be more or less uniform across the street, or will there be significant differences?

Dec 3, 2007

that is sweet... 30k to start later. that is just sweet.

Dec 3, 2007

to the original poster: Analysts have already been laid off at some places. JPM levfin for one. GS moved a bunch of S&T 1st year analysts to operations, which isn't quite the same as being laid off, but unless GS gives them the chance to move back into S&T then from a career perspective that's about as bad as being laid off.

Dec 3, 2007

I think it is still early enough in the process to reach a conclusion. I know some of the summer hiring can even drag into March. I think most the firms that are relatively unscathed will honor there commitments and take close to record numbers of 1st years. However, firms that are retreating from investment banking probably will not. As I mentioned, BOA is in a difficult situation and how they proceed will be interesting. Banking has in general normalized since the shut down of credit markets in August. If it is able to stay on pace I think GS, MS, DB, CS, UBS, and JP will have large classes. I think Wachovia and BOA will retreat from IB while the future of BS, ML, and Citi is still too uncertain to know for sure.

Frankly, I am suprised LevFin is still as active a market as it is right now. I thought subprime fears would phase many investors and holders of high yield and mezz tranches of many PE portfolio companies.

Does anyone have any thoughts on that? I haven't checked the ABX index recently, but does anyone know where it has ranged since August?

Dec 3, 2007

I work at one of the banks mentioned and there have been no analyst layoffs yet, but talk is strong that there will be. Nobody really knows what will happen with analysts - there are reliable rumors that X percent of certain divisions will be cut, but it's unclear how the breakdown between analysts/associates/vps/etc will be. Also, while it makes sense that analysts might be less likely to be cut since they are the cheapest...it also makes sense that analysts are least "crucial" to the group since they have the least knowledge, experience, etc. This may not be tru in traditional IBD where they need masses of people to do grunt work, but I work in capital markets where the group layouts are a bit more flat.

Dec 4, 2007

I-banker2007,

You are not correct. UBS is not going to have a large class (briefly dated HR chick, kind of cute). They have had cutbacks in offices within the coverage groups in IB. Yes GS and MS have faired well. JP somehow made it out looking great. Very clear that Bear Stearns is in a world of hurt. And the normal whipping boy BofA has and is fairing a lot better then you lead on. Yes they fired people... as did everyone else...but notice they are the only ones getting any deals done in the tough market. Scary to say, companies need bofa. Citi is so big, so global, that I do not think one US credit crunch is going to topple us.

Dec 4, 2007

PublicEquity1,

Only cute ones are DB and JW (since left). Even without extending FT offers to those outside the SA class, it will be a record year due to the high retention rate. As I know they are still conducting campus recruiting next year WILL be a record size class. In IBD no group has cut back its banking staff, except possibly sponsors/levfin.
I did not mean to insinuate that BoA is in any real trouble, however, they are scaling back their IB presence by choice. While J.P has done well with the model of being a "one stop shop" for financing, they have done so because they are backed by a strong IBD core (although much of their banking is concentrated in FIG). Citi and BoA have stumbled with this model since overall their banking divisions are not as strong (especially BoA). Any severe softening in the levfin market will lead to a major decrease in the IB advisory work. What people don't seem to understand is that these three banks were gaining advisory work by commiting to fund these deals (think BCE, TXU, Freescale) not because they had brighters banker. The majority of these bridge loans are still on their books, and at some level will constrain their lending abilities. I am actually suprised that CLOs created by these leveraged loans have not come under the same scrutiny as CMOs backed by mortgages. Anyone have any ideas about this? I was even more suprised to hear that Buffet bought $2 B of TXU bonds, but I guess they were discounted and safer since its a utility.

As I mentioned above I think that subprime will be a major writedown issue well into Q1 2008, so many of the banks so far "unscathed" may still have problems. I am personally concerned about who the counterparties (and their financial strength) of GS, MS, and LB's hedges. Someone has to be suffering. However more importantly, I think leveraged loans will suffer from the next subprime-like investor phobia. I haven't checked the ABX index recently, but does anyone know where it has ranged since August?

Dec 4, 2007

I heard that a BB randomly laid off some of their 1st yr bankers in their restructuring process. Can you imagine what a career bummer that is? where are they gonna go now that the market is so bad?

Dec 4, 2007

"I heard that a BB randomly laid off some of their 1st yr bankers in their restructuring process. Can you imagine what a career bummer that is? where are they gonna go now that the market is so bad?"

Do you honestly believe any bank would "randomly" let people go?

Dec 11, 2007
nystateofmind:

"Do you honestly believe any bank would "randomly" let people go?

You are obviously not in the wall street state of mind nystateofmind.

Citi is laying about 45,000 employees, UBS 1500, BOA 3000... what do you think their strategies are in laying people? Performance for the more seasoned. What about the first year analyst that haven't given the chance to perform? If not randomly, then what? Work ethics? HA!

Dec 4, 2007

I agree with nystateofmind...and restructuring at a time like this? Its like closing a vulture fund.

Dec 5, 2007

Which firm is laying off 1st years?

Someone mentioned "Very clear that Bear Stearns is in a world of hurt." Any elaboration on that? (I know subprime mess, but have they been laying off bankers?)

Dec 5, 2007

PoshMonkey,

It doesn't make sense that

A) A BB would "randomly" let 1st years go
B) If they were to let some go that they would be from restructuring.

Which bank?

Dec 5, 2007

Correct me if I'm wrong, but I believe PoshMonkey means to say 1st years were laid off as a part of an internal restructuring process.

Dec 5, 2007

Oh lol yeah I see now. I glanced over that and missed "process."

My apologies, PoshMonkey.

Dec 11, 2007

Comparison on bank layoffs - a bit outdated. But, read the comments towards the end of the page.

http://dealbook.blogs.nytimes.com/2007/10/22/the-l...

Dec 11, 2007

We're going to see a sizable number of workforce reductions at all levels, starting in January. I know, because I've helped parse through the lists. Yes, analysts will be included. While you get more bang by axing more senior bankers, who can cost the same as a dozen or more analysts each, make no mistake that the market conditions are deteriorating rapidly.

Some banks will cut more deeply than others. Some will be reluctant to act too quickly. However, even the most optimistic firms (I believe) would agree that at this point our headcounts exceed the market opportunity. Hence, we will begin re-sizing our rosters to more closely approximate the new revenue outlook. Anything more optimistic than that is wishful thinking.

Dec 11, 2007

This is scary as hell...Genghis what is the rationale for cutting specific analysts?

Just based solely on potential and/or additionally group?

Dec 12, 2007
Devils Advocate:

This is scary as hell...Genghis what is the rationale for cutting specific analysts?

Just based solely on potential and/or additionally group?

Every firm will approach the issue differently depending on their specific issues.

Often, the cuts will be done by group (this is to take the discretion out of the hands of the group head, since nobody wants to take more heads out of his own group than he needs to). Thus, the executive leadership tells the group head they've decided that he needs to take x number of MDs out (and they will suggest names for MD shootings), then the number of people at each level south of that. It is then up to him and his close colleagues to determine who the unlucky individuals are.

This selection is done by a number of ways. Everyone but the newest additions will have had some sort of review history, and so the underperformers from the latest review periods are at the most risk. However, nobody wants to start killing off people lightly, so often what I've seen happen is that the staffer will be given the task of polling the group. Who are the top three people of this level who have worked for you? Who are the bottom three?

Names that appear in the top three repeatedly quickly get exempted. Repeats in the other group put your neck on a collision course with the sharp end of the blade.

Look, I don't think the carnage at the analyst level will be severe, at least at this point. For reasons I've walked through in the past, it's not a big bang for the buck item. But the analyst pool isn't going to come out of this one unscathed. Analysts may be relatively cheap by banking standards, but they make real money and you stack up a number of them and it starts adding to net income a lot faster than cutting black cars, taking away free coffee machines or reducing dinner allowances (and trust me, we'll see some of that too).

  • b
  •  Dec 12, 2007

January...? Right in the midst of SA recruiting? Will the layoffs and wariness affect summer hiring?

Dec 12, 2007

I am in the midst of studying for finals and I gotta say - that scared the shit out of me. I'm also curious how summer hiring will be affected, as well as FT for next year.

Dec 12, 2007

so are ft people starting this june in danger?

Dec 12, 2007

Genghis,
Not sure how long you've been in banking, but if you were around back in '01/'02, can you compare today's mood with back then?

Dec 12, 2007
ex-banker:

Genghis,
Not sure how long you've been in banking, but if you were around back in '01/'02, can you compare today's mood with back then?

I did indeed live through those days, and it was an incredibly painful and traumatic time. You have to understand, I went through seven (!) rounds of cuts. The worst two took out about a third of our remaining headcounts each. At that point, you're well past cutting fat, or even muscle. At that point, the knife is going to the bone, and it hurts. Even those of us who made it would be wandering around the halls like zombies. You're like shell-shocked survivors after a neutron bomb strike - the building is still there but the people are all gone.

It was awful for the people who found themselves jobless, in an economy where their chances of continuing in their chosen profession were effectively zero. What you perhaps don't realize was that it was equally bad for those of us who made it. Morale was in the tank. You didn't know when the next round was coming, and so many people (both good and bad) had been axed that you really began to understand that you might well be next. Fairness and merit play a key role, but at the end of the day it's never a perfect process.

What's my point in regaling you with stories of the dark days of 01/02/03? Well, it's to say that it's not that bad... yet. It feels to me like mid-2001. We'd had some minor performance cuts early in the year, and mid-summer we had our first real workforce reduction, a 10% job that opened eyes but didn't really put the fear of God into us. It wasn't until after 9-11 that we took the first body blow. A 25-30% cut came to a lot of firms in November/December, and that was an eye opener. A real "holy shit" deal. I don't feel like we're there yet.

We may well get there by April. I hope not. We're sort of on the edge of the knife, at this point, and it could go either way. I'm hoping that it's more short lived, like '98. Six months later and we were back off to the races. But that was a more specific, contained set of events, between Russia, LTCM and some devaluations. The issues we've got today are more systemic, and I'm afraid that they'll take a lot longer to work through. We'll see.

Dec 12, 2007

Oh shit, I'm on an H1B...if I lose my job I'm going to get deported to Canada...Fuck!!!!! I don't wanna go back to Canada...

Dec 12, 2007

Why the hell do they call it "layoff"? It's a firing. Call it a firing and deal with it.

"We are lawyers! We sue people! Occasionally, we get aggressive and garnish wages, but WE DO NOT ABDUCT!" -Boston Legal-

"We are lawyers! We sue people! Occasionally, we get aggressive and garnish wages, but WE DO NOT ABDUCT!" -Boston Legal-

Dec 12, 2007

Firing generally refers to an individual being let go "for cause" - meaning that termination was for something specifically done by an individual.

Broader groups being let go is more a reflection of company or industry-wide impacts, so the lighter term of layoff is used.

Dec 12, 2007

And whats wrong with Canada mrcanuck?

Dec 12, 2007

I like Canada as a country, but the job opps in finance in Toronto suck compared to New York. That's the problem with being international...if I lose my job its game over and back to Canada. ..I guess I'll go back to my old HS job of managing my local ice hockey rink...yay

Dec 12, 2007

Genghis Khan, for your colleagues who were laid off, what did they end up doing next? What are their options?

Dec 12, 2007
Banana_milkshake:

Genghis Khan, for your colleagues who were laid off, what did they end up doing next? What are their options?

It depends. For those who took a bullet very early (up to mid-'01) or very late (mid '03), many found new jobs with other firms who were more aggressive about the opportunity. Those caught in the middle, for the most part, exited the business and either never came back, or at best found their way to very small boutiques.

The problem with sitting on the sidelines is that your contacts atrophy and your information flow becomes stale. You are out of the stream of conversations, and you get out of date fast. Meanwhile, new classes of bankers are moving up the ladder. By the time the market turns, it's hard to find your way back to the business.

Dec 12, 2007

Thanks - now your post really motivates me to keep in touch with my b-school friends working at other banks.

Dec 12, 2007

new 1st years are relatively safer, since we have not really had a formal review yet?

  • b
  •  Dec 12, 2007

Genghis, how do you think summer hiring will procede? Will there be reservations there as well?

Dec 13, 2007

Genghis, Thanks for your comparison with recent history. Very insightful.

Dec 13, 2007

You needn't layoff analysts to cut down the headcount substantially. You can not give out third year offers, not extend associate offers to third years, and decrease hiring. Just as people have been talking about how less SA got full-time offers, this can easily flow down the line.

Also, analysts have a limited program scope so it becomes much more attractive to cut associates. Associates cost a lot more and provide a lot less value at the lower levels (1st year associate straight out of b-school vs an analyst with 1 year under their belt). Associates out of business school also have MBAs, so people feel less bad about cutting them, they can go get another job (thats why they got the degree in the first place).

For middle performers on the cusp of getting laid off (not the bottom of the pack but not the top), its very easy to not promote and lighten the bonus load. This way you can get people to look for other pastures without laying them off (always looks better).

Just some thoughts

--There are stupid questions, so think first.

Dec 13, 2007

They're mostly exempt because they're aren't worth firing (even if performance dictates otherwise, usually). Terrible for recruiting, analysts are cheap, and they aren't expected to stay very long anyway.

Dec 13, 2007

They are def not exempt

Dec 13, 2007

I hope it wont be a big effect as I start in the summer

XX

Dec 13, 2007

Not as bad as what happened back in 2008/2009, but yes, there are first year analysts and associates getting canned already in a number of banks.

Dec 13, 2007

First years are not exempt. Anybody who tells you otherwise is lying to your face.

Dec 13, 2007

They're not exempt, but they are still one of the least likely to get fired. They cost less than any other person in the office and do the most excel/ppt work. They could cut one associate and it would be the same as dropping almost 2 analysts.

Dec 13, 2007

Summary: Not impossible, but at the same time, incredibly unlikely unless you are God awful. The end.

Dec 13, 2007

Definitely possible, however if you are on your toes you should be fine.

Dec 13, 2007

Back in the 01/02 layoffs a lot of 1st and 2nd year analysts got cut.

Dec 13, 2007

from what i've seen, not often.
i have a handful of 2nd year analysts that were given the pink slip recently however.

Dec 13, 2007

I am very professional so my opinions my be a little callous (and perceived to be Romney-esque) but there are a good 10-25% of analyst and associates who deserve to be laid off. After the recruiting filters, every single person may come off as capable, passionate and determined individuals on day one of training but it becomes quickly evident after a few months who can hang and who can't.

Typically in good markets, these people end up sticking around since it is terrible PR for any bank to lay off new hires simply for being good-but-not-good-enough / slightly-ineffective workers. What a bad market does is that it really slashes through the BS and gives banks an excuse to lay off their bottom 10-20% performers.

So, yes - new hires are not going to be protected in a bad market. The best way to safeguard against a layoff is to work hard, be passionate and be well-liked. Be a top performer.

    • 1
Dec 13, 2007
Vancouver Canucks 2011:

I am very professional so my opinions my be a little callous (and perceived to be Romney-esque) but there are a good 10-25% of analyst and associates who deserve to be laid off. After the recruiting filters, every single person may come off as capable, passionate and determined individuals on day one of training but it becomes quickly evident after a few months who can hang and who can't.

Typically in good markets, these people end up sticking around since it is terrible PR for any bank to lay off new hires simply for being good-but-not-good-enough / slightly-ineffective workers. What a bad market does is that it really slashes through the BS and gives banks an excuse to lay off their bottom 10-20% performers.

So, yes - new hires are not going to be protected in a bad market. The best way to safeguard against a layoff is to work hard, be passionate and be well-liked. Be a top performer.

I agree that there are a lot of people that are good enough, but not great after they get the job. There are probably more of those than analysts who are actually good at what they do, which doesn't really take much. However, in a down economy you typically have even more pitching going on than usual, even if it doesn't produce any live deals. This means you still need the half-ass analysts who can at least throw books together that require minimal effort. I don't think you can typically fire based on a lack of work unless you severely over-hired during an upswing in business.

Dec 13, 2007

yea what happened to all the "shits gonna hit the fan tomorrow"? All that anxiety yesterday gave me so much gas!!!

Dec 13, 2007

ai....

Dec 13, 2007
ibhopeful532:

ai....

no...its the coach from the coors commercials. jim mora

"Look, you're my best friend, so don't take this the wrong way. In twenty years, if you're still livin' here, comin' over to my house to watch the Patriots games, still workin' construction, I'll fuckin' kill you. That's not a threat, that's a fact.

Dec 13, 2007

colts suck.......

  • Commuter
  •  Dec 13, 2007

this explains why emails haven't been responded too

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Dec 13, 2007

Anyone? Bueller?

actually, this looks like a job/response for genghis Khan!

Dec 13, 2007

Are you looking for buyside jobs at this point?

Dec 13, 2007

let's just say i'm keeping the opportunities open. My friends were pretty much blind sighted by their layoffs and i don't want the same to happen to me. Eek.

Dec 13, 2007

I guess I don't understand that answer. Are you currently interviewing or not? Because most of the bigger shops are done at this point.

Dec 13, 2007

I am. However, I'm not really looking to join a big shop. A few MD's have my resume from the big places like Carlyle and Blackstone (they are pretty strong contacts built through alot of alum networking) and have stated that they could pull some strings if I really wanted to interview. I don't think I'm ready for that environment though. I still have a lot to learn.

Dec 13, 2007

.

Dec 13, 2007

From a job security standpoint, it's probably a good idea. A director in banking once tried to convince me to make a career out of it, his main arguments to me were "money" and "job security." I wonder if he still stands by his words.

Dec 13, 2007

I guess we will just have to see what happens. In any respect, i'll just continue chuggling along but keep my eyes peeled.

Dec 13, 2007

Look at hedge funds as well, they have relatively more open positions than PE places- at least that is what I have gathered.

Dec 13, 2007

Can anyone comment on what they think the fate of the incoming Analyst class is (ie: Those graduating from school these days and about to start work). I can't say I'm not worried.

Dec 13, 2007

But I think there are 2 distinct concerns:

1) Existing analysts/incoming hires getting laid off.

2) Existing/new hires not getting good experience due to the poor market and lack of M&A/deal activity in general.

Although it's easy to mostly focus on #1, I think #2 is an equally valid concern. There's no point in doing this job if your office has 0 live deals (that's an exaggeration but you would rather have more activity rather than less).

Will some incoming Analysts be laid off? Yes, probably. It's not going to be a huge %, but some could very well lose their jobs.

To guard against this, I would try to constantly be networking and making connections at other firms, whether banks, PEs or HFs... you never know what it will lead to.

But the reality is nothing is a sure bet in the real world, and finance jobs in general are much "higher beta" than those in other industries.

Dec 13, 2007

How would banks decide which incoming analysts to lay off? Obviously they can't decide based on previous work. Does it become a last in, first out sort of thing? Or is there some other criteria banks look at? How important do connections become?

Dec 13, 2007

I would think it probably depends on the group you're in... so anything related to Leveraged Finance, Mortgages, etc. is probably in more danger than an industry group like Healthcare which is more "recession-resistant."

Take that with a grain of salt, though: I really don't know since I was not around back in 2001.

Maybe someone who was around during those days has a better idea?

Dec 13, 2007

it can happen
but all depends
unless ms really wana fuck up the recruiting and it needs to fire mo ppl fast, i dont see them rescind cheap offers

Dec 13, 2007

The chances of a middle office role being rescinded is next to nil unless the platform, group or sector is being restructured in a major way. This is similar to analyst firings in investment banking, rare, really only saw it in 08/09 time frame because of the mass downturn

In terms of helping your friend, the same principal applies. Can he do anything about it? No not really.

So the best way to phrase it is something along the lines of. "Worrying about something that might happen is not going to increase your performance or improve your options if that does happen" .

So just give him he jist, chances are small, even if it does happen, get back to applying and working hard. Not much else that can be done.

Worrying (caring is different) is a terrible infection that gives no positive results.

Dec 13, 2007
WallStreetPlayboys:

The chances of a middle office role being rescinded is next to nil unless the platform, group or sector is being restructured in a major way. This is similar to analyst firings in investment banking, rare, really only saw it in 08/09 time frame because of the mass downturn

In terms of helping your friend, the same principal applies. Can he do anything about it? No not really.

So the best way to phrase it is something along the lines of. "Worrying about something that might happen is not going to increase your performance or improve your options if that does happen" .

So just give him he jist, chances are small, even if it does happen, get back to applying and working hard. Not much else that can be done.

Worrying (caring is different) is a terrible infection that gives no positive results.

Though I agree that the chances of this offer being rescinded are almost invisibly slim, it is certainly not true that the last analyst layoffs were in '08 and '09.

"For all the tribulations in our lives, for all the troubles that remain in the world, the decline of violence is an accomplishment we can savor, and an impetus to cherish the forces of civilization and enlightenment that made it possible."

Dec 13, 2007

he 29?

Dec 13, 2007
MomentaLaugh:

he 29?

Yea, he got a really late start. He pretty much didn't care about grades in high school and bummed around community college for a bit while working retail. I think it is one of the reasons why he is so worried; he worked really hard to get into university and get the MS internship.

Dec 13, 2007

Sure analysts do get laid off every year, the amount is low unless you're not very good or your group gets shut down, major peoe quit or something else large occurs.

The real point to make here is this... what is gained by worrying about it? Nothing. This is usually a mindset of someone in their low 20's versus 29.

Since it's his friend would just tell him to relax, and tell him the truth, chances are extremely low and more importantly the only thing he can do to help himself at this point is perform well on the job.

Dec 13, 2007
WallStreetPlayboys:

Sure analysts do get laid off every year, the amount is low unless you're not very good or your group gets shut down, major peoe quit or something else large occurs.

The real point to make here is this... what is gained by worrying about it? Nothing. This is usually a mindset of someone in their low 20's versus 29.

Since it's his friend would just tell him to relax, and tell him the truth, chances are extremely low and more importantly the only thing he can do to help himself at this point is perform well on the job.

Agreed re: there is no reason to spend time worrying about getting laid off as a 20 year-old.

"For all the tribulations in our lives, for all the troubles that remain in the world, the decline of violence is an accomplishment we can savor, and an impetus to cherish the forces of civilization and enlightenment that made it possible."

Dec 13, 2007

Yes but far far far worse

Dec 13, 2007

No surprise there. 20,000 of the 40,000 job cuts in finance this year alone are from citigroup. I'll bet that job losses will continue in ibanking, especially after BofA reported a 90% decline in its investment banking

Dec 13, 2007

Some parts of that table are worthless. At UBS's "Investment Bank," you have forex, prime brokerage, equity research, blah blah blah. Which jobs are getting cut? NO IDEA, because they won't tell us.

Even Morgan Stanley's "Investment Banking" unit includes Real Estate, which includes proprietary RE investing. Again, who knows where the actual job cuts are?

Dec 13, 2007

From what I understand, many consulting firms that specialize in restructuring (FTI, A&M, Huron, etc.) have been hiring record number of graduates for their groups due to the high demand for their service.

Dec 13, 2007

I don't think that is what OP was referring to.

Haven't seen many layoffs so far, consulting firms are usually a little cagier about planned layoffs than banks. Come back in 6 months and it may be a different story.

Dec 13, 2007

How much is the recession going to affect consulting firms' business and consultants' hours?

Dec 13, 2007

Doesn't make a whole lot of sense for firms to layoff ACs as they are relatively cheap labor and usually went through a rigorous hiring process to get strong people. A buddy of mine is an AC at B/M/BCG and just got re-staffed after 2 months on the beach so even if they are not busy, they may be keeping them on.

Dec 13, 2007

I'd expect Bain to be hurt the most out of MBB because they focus more on FIG/PE work...though this is just based on what I read on WSO

Dec 13, 2007

jimbo, does layoffs of upper level people mean much less hiring of junior level people?

Dec 13, 2007

well one layoffs are across the board, and two yes that's a good assumption.

Dec 13, 2007

Scary things going on today. Just decided to hide under my desk.

Dec 13, 2007

or it could mean more capital to disperse among analysts LOL

Dec 13, 2007
bmwhype:

or it could mean more capital to disperse among analysts LOL

Wouldn't that just be a beautiful thing!

Dec 13, 2007
bmwhype:

or it could mean more capital to disperse among analysts LOL

you guys are gonna get fugged in july. count on it.

Dec 13, 2007

"what's that? uh...layoffs? don't talk about layoffs, you kidding me? layoffs?! i just hope we can get our bonuses!"

-jim mora

Dec 13, 2007

fully expecting a non-existent bonus in july. as everyone else in my group was told this week, "your job is your bonus this year"

Dec 13, 2007

What do you mean by "I always encourage people to reneg"? Do you mean renegotiate salary terms before starting, while working, or something entirely different?

Dec 13, 2007

he means if u accept an offer and then u get a better offer, u "reneg" on the first offer.

Dec 13, 2007

Boutiques have been grabbing market share for awhile now. I think as of the end of 3Q the boutique share of M&A was around 17% - an historical high.

Also consider that the vast majority of these layoffs are in trading and other capital intensive businesses. While the sluggish economy has put a large dent in advisory revenues, it's more of a cyclical change than the structural one facing the trading businesses.

I think all things considered the smaller guys are doing better headcount-wise.

Dec 13, 2007

It's been going on since the dawn of ages.

1. Announce layoffs before Christmas
2. Fire people before bonuses
3. PROFIT!!!!

Dec 13, 2007

Wouldn't surprise me to see Barclays really scale back it's global IBD business.

Dec 13, 2007

And I thought that the IBD business was diamond...

ha ha ha ha :-/

1percentblog.com

Dec 13, 2007

So for Barclays they'd scale back the whole investment bank or what? They seem to have a very profitable operation so that would be mainly for reputational risk.

The truth is you're the weak. And I'm the tyranny of evil men. But I'm tryin', Ringo. I'm tryin' real hard to be the shepherd.

Dec 13, 2007

So this explains why my UBS contact in the LA office hasn't replied to my most recent email...

Dec 13, 2007

The worst has passed, but I definitely wouldn't assume layoffs are over.

Dec 13, 2007

UBS also announced yet another quarterly loss, so I'd say more are still coming

Dec 13, 2007

GS says unemployment will reach 10.5%, roubini says the world is going to end, i think the worst is likely over but I know from our own portfolio companies that we have a lot of expense contingencies built in should sales continue to deteriorate and I would assume that most companies do as well

Dec 13, 2007

Barcap have layed off some of their equity people in US and London this, and last, week according a friend who is interning there.

Just my 2c.

Just my 2c.

Dec 13, 2007

From what I heard:

Many investment banking divisions of a lot of these banks are currently overstaffed, as they are getting ready to pick up deals once the recovery is under way. M&A is still dead (many talks, no closed deals). Basically it is the financing division (bond and equity) that is making the fees at this point since many companies are taking this stock market run-up as an opportunity to issue more debt and equity to refinance their old debt or delever. The current financing deal pace is enough to keep the bankers employed, but if the stock market crashes again and the deal pace stops, it will be the rebeginning of the layoff cycle.

So let us pray for the recovery.

Dec 13, 2007

Layoffs are over for now. Banks typically don't cut when interns are there. Layoffs occur in good and bad times and if you suck (and don't have great connections), you're out. that's the way its always been. But the bar is certainly set higher now.

Dec 13, 2007