We Are In The Midst Of A Secret Wall Street Hiring Shuffle
Since the financial crisis, bulge bracket Wall Street banks have been handing out smaller bonuses made up of less cash. Now when bankers aren't happy with what they've taken home at the end of the year, they start to look for options elsewhere.
On Wall Street (especially in sales), bonuses are tied to team performance, not individual performance, so even if you personally rocked 2012, your team's performance could hurt your bonus prospects.
That's where this January hiring shuffle comes from.
"People who leave because of bonuses are having their positions filled quickly, and they (Wall Street banks) want someone good from a comparable firm." said Jesse Marrus, founder of Wall Street career search firm StreetID. "It's going to be a frenzy to fill those seats... You would think people would wait til the end of Q1 but they have a lot of pressure to keep things going."
Marrus told Business Insider that these positions aren't highly publicized because the hiring is generally done through back channels and networking.
And since Wall Streeters already knew that 2012's bonus season was going to be rough, they could've started the process of talking to friends and peers about their next moves months ago.
Financial professionals don't just want to go to big banks either, they're considering smaller boutiques more than they used to. In December, Jefferies announced that it would be handing out cash bonuses. It was a way for the firm to signal to the Street that if top talent heads over, it will be compensated handsomely.
So what are firms looking for? Marrus said he's noticing a lot of demand for individuals with experience in the European high yield and distressed debt space, and for wealth managers/financial advisors with a thick Rolodex.
No one should be surprised that banks are interested in employees who know their way around Europe, Wall Street's been talking about that for months.
As for why banks want wealth managers — Skiddy von Stade, CEO of job financial search firm OneWire, explained that banks are loving that space because it's "sticky money." Once clients have given their money to a firm it takes a lot them to move it elsewhere.
Another thing to keep in mind regarding this space is that the skill sets that Wall Street firms are looking for in wealth management can differ depending on the firm's size.
"The thing with say, a Merrill is that you have an array of investment products that you can't get at a smaller shop," said von Stade. That's what really makes the difference.
At bigger shops wealth managers are more like salespeople who need to understand each and every product and how it can work for their client. Wealth managers at smaller shops are more "in the weeds financial professionals who really breathe the market," von Stade added.
Bottom line: The most important thing for firms is to find the perfect fit. If they can't do it fast enough through connections, Marrus says they're willing to pay a third party recruiter to find the perfect person for them, and that's encouraging for the industry as a whole.