Times are good on the pay and hiring fronts if you work in fund management, but they are especially good if you work in fund management marketing.
In the US, the UK and Germany, fund management recruiters report abundant job vacancies. Funds are hiring top talent to manage institutional assets; they are also fighting tooth and nail to sign marketers who can deliver the assets in the first place.
Europe: Lies and statistics are true
If lies and statistics are anything to go by jobs in fund management should be plentiful right now. A recent study by the Centre for Economics and Business Research (CEBR) forecast more than 1,000 new fund management roles in London during 2005.
A separate survey of over 200 financial institutions by recruiter Morgan McKinley said demand for fund management staff is driving up pay.
Patrick Morrissey, managing director at London-based executive search firm Sheffield Haworth, confirms his asset management consultants are unusually busy: 'Hedge funds have been taking teams and they need replacing, firms are rebuilding, and there is general upgrading.'
Morrissey points to rebuilds at the likes of Schroders and F&C Asset Management. This week, for example, Schroders announced the recruitment of six staff for its global emerging markets equities team as part of the overhaul of its global emerging equity markets business.
In March F&C recruited Jacob De Wit from Dutch rival SNS Asset Management as head of fixed income, but London fund management recruiters point to equities as the area of most activity. 'In the UK, the emphasis is back to equities,' says Petra Rickmeyer, head of the financial services practice at search firm Hoggett Bowers. 'After hiring in fixed income, funds are looking to get the right balance again.'
SG Asset Management, Goldman Sachs Asset Management and Morley Fund Management were among those hiring equity fund managers in March and April.
Other London fund management recruiters are preparing for a rush of hiring by retail funds looking to penetrate the institutional space. Chris Manfield, head of the European Asset Management practice at the Whitney Group in London, puts AIG, Franklin Templeton and Pioneer Investments in this category. 'These funds are able to show good investment performance over a sustained period of time in the retail market,' says Manfield. 'Most are also offering exciting investment products.'
Marketers rise to the top pile
Fund managers may be in demand, but recruiters say the biggest draw in Europe right now is experienced fund marketers, particularly those with institutional contacts in Scandinavia, Benelux and Germany.
Rickmeyer says UCITS 3, the European directive implemented in January 2004 which facilitated cross-border fund marketing in Europe, is stimulating increased demand for sales people with contacts in the Nordic region. 'In March, eight funds were looking for Scandinavian sales people,' she says.
Patrick von Pfetten of Frankfurt search firm Von Pfetten & Kollegen reports voracious demand among German-based funds for anyone with demonstrable experience selling to the German insurance and pension fund sectors: 'Everyone's trying to hire people who can bring in business,' he says.
Morgan McKinley's survey found salaries for marketing staff in fund management rose 20% in 2004, to between 40,000 and 65,000 for people with four to eight years' experience. It says marketers with more than eight years' experience are paid salaries of 70,000. This may understate the reality. Manfield says top marketers in London are paid as much as 20% of management fees levied on the funds they bring in: a marketer who raises 1 billion could earn 900,000 on the back of that.
Strong demand for marketers has pushed them to the top of the pay pile in Frankfurt. Von Pfetten says good salespeople in Frankfurt can now earn €100,000 to €120,000 in base salary, plus a 300% bonus. This makes them considerably better paid than experienced German fund managers, who according to von Pfetten are lucky to earn €75,000 to €100,000 in base salary, plus a measly 100% bonus.
US: whole teams and friends of consultants wanted
US recruiters highlight team moves and renewed demand for consultant marketers as evidence of the asset management sector's robust health.
'People are lifting whole teams because it's an easy way to build a franchise,' says Kathleen Tompkins, head of US asset management recruitment at Sheffield Haworth in New York City. 'Generally people are looking for institutional teams with a strong track record,' she says.
Examples of recent team hires include HSBC's lifting of Richard Lindquist and six members of his high yield bond team from Credit Suisse Asset Management. Separately, Delaware Investments hired four large cap growth equity investment managers out of Transamerica Investment Managers at the start of April.
Jacob Navon, an asset management recruiter at search firm Westwood Partners, says US funds are again interested in people who can market funds to investment consultants. 'A few years ago firms turned away consultant marketers and had the sales force cover consultants as well as end users,' says Navon. 'Now the trend's turned back to dedicated consultant coverage, but there are very few people out there who've been doing this at a senior level.'
In early April Janus Capital, the Denver-based fund manager, hired Carolyn Patton from Morgan Stanley in early April to direct its global consultant relations business.
The move towards dedicated consultant coverage is also visible in London, where State Street hired Valerie Nicholson as director of marketing and consultant liaison earlier this week. Morley Fund Management hired Angus Scrace as head of strategic consultant relations in February.
Hedge funds: Two-way street
No article on employment trends in the fund management industry is complete without a brief mention of hedge funds.
The lone wolves of the fund management world continue to pick up staff on both sides of the Atlantic. But recruiters insist the trend is slowing.
'The one-way street to hedge funds has become two-way,' says Navon. 'A healthy number of people are now interested in coming back to traditional firms.' Last week, for example, UBS hired John Laub out of Ziff Brothers, a hedge fund, as managing director and chief administrative officer of its prime services business.
Navon says the incentive to move has fallen as the differential between pay at independent hedge funds and hedge funds integrated with larger fund managers has shrunk. 'You used to earn a huge lot more at a hedge fund,' he says. 'Now pay is more in the same ball park than it used to be.'
Large fund managers are offering more lucrative terms to people working at new in-house hedge funds, says Navon. Money is ring-fenced for the in-house managers and bonuses are allocated formulaically instead of subjectively.