Anyone worried about getting laid off?

SomePleb's picture
SomePleb - Certified Professional
Rank: Gorilla | banana points 743

Title says it all. Would be interesting to get a poll going including firm size (bb/mm/etc) and sector.

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Comments (35)

Dec 21, 2018

Nope, but no firm had a good year

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Dec 21, 2018

I work in restructuring, so no.

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Dec 23, 2018

Nah, just worry about getting laid.

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Dec 24, 2018

And paid.

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Dec 28, 2018

Read this title as "Anyone Worried About Getting Laid Often"...

My soul is highly leveraged

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Dec 24, 2018

Would probably be more worried if I were a VP or something more mid-level than a mere associate.

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Dec 26, 2018
sl55amg:

Would probably be more worried if I were a VP or something more mid-level than a mere associate.

this.

Dec 27, 2018

Agreed. If a recession is somewhere in the next 1 -3 years then an expensive VP or low revenue generating Director would be a bad spot to be in. Analysts / associates are generally protected and can ride up the wave post-contraction once they hit VP when business expands again.

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Most Helpful
Dec 28, 2018

From someone who has been through a couple of downturns.
That comment is absolutely bull shit - it's a numbers game not a money game.
Analysts and associates are at high risk of getting let go. VPs who have been with the firm for a few years even if underperforming are in a much better position.
Truth.

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Dec 28, 2018

Can confirm from personal experience in F500 Corporate that lower level people are easily let go vs tenured senior staff.

Dec 28, 2018

Im at a F500 doing well and Director+ is always a tough spot here. Corporate darwinism on overdrive. Tons of directors/vps with 1 decade+ in tenure are gone.

Dec 28, 2018

Yeah, big layoffs are here to stay in F500. And that's regardless of how the economy is doing. I can't imagine how bad it's going to get when the economy hits a rough patch.

But I don't disagree with some of what's happening. There is so much "excess fat" in these companies, these need to happen to make them more efficient. Perhaps more efficient = not many layoffs when the inevitable downturn comes.

Sorry to hijack a ER thread from a F500 perspective, but these are some general labor force trends across industries.

Dec 28, 2018

Cool. This isn't F500 jobs it's banking particularly and I echo that I would be much more fearful for my job as a low performing Director or as a VP who maybe they don't see fits in long term. Analysts and more junior associates are relatively safe unless you aren't very good which makes this a good opportunity to fire

Dec 28, 2018

Second this. My background is IB not ER, so maybe some differences there. But to the extent ER is similar to IB, VPs and directors are the most vulnerable.

Should be easy to see why. MDs can point to their book of business and associates/analysts can point to the fact that they're cheap. Mid level people are pretty expensive and have more nebulous value.

Also, most VPs/Directors have been unofficially pegged as either future MD material or not. If you're one of the less promising ones, and you still have a 600k job today because the firm was giving you some time to improve your standing, you're obviously the easiest person to fire when cuts need to be made.

That's not to say anything is predictable. I'd still look at performance most. A good VP is safer than a weak analyst. The mid-levels are the most vulnerable if all else is equal.

Dec 28, 2018

A VP and a Director have built human capital and will know the MDs. A brand new VP or Director on a team is LIFO unless he costs a decent amount to hire. As an MD you are asked to fire people - who do you fire: An analyst or associate you barely know with little to no value? Or a VP/Director who can at least produce something of value even if not ideal.

Analysts and associates are a dime a dozen - you let them go in a crisis and pick some back up when the economy gets better. What you will realise is the office space an analyst consumes, the HR resources dedicated to the analyst, the fucking coffee he drinks - all of this adds up and the fixed costs an analyst and a director have are relatively similar in the end - the salary is just on top. The bonus won't get paid if the economy tanks either way. So you are left with just a fixed base cost and a fixed salary which is marginally different by give or take 200k (sure if you take an analyst first year to a director +3 you'll get a bigger delta... but we are doing averages here)

You have not experienced a crisis if you haven't been around in '08 if you have you wouldn't be arguing with me on this. People in my grad program who "cost nothing" were getting completely shafted. The only people staying at the bank were the ones that were closest to their MDs and if said MD had any political weight.

Not sure how it goes in F500 - I am talking for BB banks in '08 only here.

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Dec 28, 2018

I joined after '08. You got me there. But FWIW I've seen 3 rounds of cuts and the VPs took the brunt of it each time.

Maybe my mistake was lumping in directors. Most groups I know have very few directors anyway; you only stick around to director level if it's already been made clear you're a strong MD candidate. So yes, I agree with you that directors (or "chosen one" VPs) are safer.

I've also seen that the MDs don't get full autonomy in cutting whoever they want; guidance from the head of IBD seems to play a big role there.

Jan 10, 2019
Disjoint:

A VP and a Director have built human capital and will know the MDs. A brand new VP or Director on a team is LIFO unless he costs a decent amount to hire. As an MD you are asked to fire people - who do you fire: An analyst or associate you barely know with little to no value? Or a VP/Director who can at least produce something of value even if not ideal.

Analysts and associates are a dime a dozen - you let them go in a crisis and pick some back up when the economy gets better. What you will realise is the office space an analyst consumes, the HR resources dedicated to the analyst, the fucking coffee he drinks - all of this adds up and the fixed costs an analyst and a director have are relatively similar in the end - the salary is just on top. The bonus won't get paid if the economy tanks either way. So you are left with just a fixed base cost and a fixed salary which is marginally different by give or take 200k (sure if you take an analyst first year to a director +3 you'll get a bigger delta... but we are doing averages here)

You have not experienced a crisis if you haven't been around in '08 if you have you wouldn't be arguing with me on this. People in my grad program who "cost nothing" were getting completely shafted. The only people staying at the bank were the ones that were closest to their MDs and if said MD had any political weight.

Not sure how it goes in F500 - I am talking for BB banks in '08 only here.

Been around since before 08, but not in IB or ER but had some friends/ex-colleagues there. 08 is definitely an anomaly where whole groups were getting let go. Many Jrs were hired at that time due to expected expansion as late as 07, only to get completely restructured out.

The trend since then has been more lower paying roles, *relative less middle (compared to 'lower') paying roles (many publications over the recent years on this trend).

Assuming its a 'regular' recession, and with that trend mentioned, I would agree with the sentiment that mid-level are more at risk. Also, the regulatory environment is much more stringent and encompassing which is what the Jrs now fill as well as part of their function/duties so are needed more. Some cases, there's more standardization approach to many roles that hungry MBA grads will eagerly fill, and do as part of what mid-level would have done before.

Jan 11, 2019

Even factoring out the bonus, wouldn't it be correct to equate 1 VP cut = 2 AN/AS cuts? Even so, I'm not disagreeing with you.

Jan 18, 2019

Agree on this point. Saw it at a BB and EB. Analysts & Associates were simply numbers and new VPs let go on LIFO basis. It is a constant risk and the only way around it is developing relationships with senior leadership (MDs) who will remember your name in the meetings when they decide who to cut. People can argue it but there is a significant amount of luck in staffing as a junior banker and if you get staffed with good people, you have a better chance of sticking around.

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Jan 9, 2019

1-3 years? I'm guessing you've never worked in a down market...

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Dec 27, 2018

What is driving the worry?

Funniest
Dec 27, 2018

Username checks out.

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Dec 28, 2018

I'll add my $0.02...

The experience in my firm (MM) has very much been a safe one for associates/senior associates and not a very safe one for senior analysts. If you are an analyst who is not performing well and not a go-to guy in the space you should be pretty damn afraid of getting laid off eventually in this environment. Obvious exceptions are: 1) mediocre analysts who are tied to a lot of banking revenue so the coverage is necessary, and 2) newly minted associate-analysts/analysts who are still ramping up.

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Dec 28, 2018

I'd be worried about getting laid off as a junior associate working under a weak / low-rev director, VP, etc.

If a lead analyst leaves or gets laid off, what happens to the junior associate below them?

I would guess in a rough economy, you might give the junior guy the boot too.

Dec 28, 2018

I can only speak for what I've seen at my bank, but when this happens, the associate (assuming they don't suck) is given the opportunity to switch to another team. Turnover is generally high enough that there will always be at least one associate spot open to move to. That's current environment though. If things get worse like in a recession, companies may not be as nice about it...

Dec 28, 2018

What kind of severance would be typical if somebody at the associate were to be cut for something non performance related, like an analyst leaving or a firm making cuts? Anything at all?

Dec 29, 2018

Two weeks pay? Maybe four.

Jan 18, 2019

If it is the first round of cuts folks tend to get more 4-8 weeks in a BB and 2-4 weeks in smaller banks. If the bank does subsequent rounds, it gets much shorter. Saw this happen in '08 & '11.

Jan 9, 2019

Your in the world of high performance finance. That's the worst thing that could happen. But then it again it is a bare minimum of the level of existence you should be maintaining.

Don't feel bad if you as well. Every other sector is literally a step down - so enjoy the ups and downs and if it goes bad - at least you would have given it your best shot.

Caution to the wind - don't even think about this again please!!!!!!!!

Corp. Fin. Analyst currently working two finance jobs (and a teaching gig and trying to save my music production solo career). I love avocado's. And yes Cape Town is the most beautiful place in the world. Don't believe me, come thru and find out.

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Jan 10, 2019

[Double post]

Jan 10, 2019
Njabulo Vincent-Hadebe:

Caution to the wind - don't even think about this again please!!!!!!!!

Damn this is a 2019 shmood

Jan 9, 2019

Nah

Jan 10, 2019

Not really. My review is due for this month and I have already been told how my workload will increase throughout 2019. Unless they're slow rolling me, I think I should be fine. Also my team has been solid this year compared to others at the firm.

Dayman?

Jan 13, 2019
Jan 18, 2019