The Dow is up and business is good, but switching jobs on Wall Street isn't as easy as it once was. Unlike the supercharged years of 1999 and 2000, investment banks and trading firms are more reluctant to add positions unless there's a well-defined business reason to do so.
"What's different about this turnaround is there's not a lot of hiring," says Alan Johnson, managing director of Johnson Associates, a compensation consulting firm. "Firms have been unusually disciplined."
Consequently, Johnson doesn't see the kind of "mass movement of new people" that characterized the early Internet years. "If you took the top 10 or 15 firms, headcount is pretty flat," he says.
Peter Ard, director of recruiting firm Global Sage, Ltd., won't go that far, but he does say employment growth on Wall Street is "a bit more conservative" today. He characterizes it as "smarter and more targeted at areas that are doing well."
However, banks will certainly staff up when the business warrants it. Johnson sees growth in investment banking and corporate finance, but relatively little in support and back office positions.
"You're going to pay for talent or pay for juniors, but you're not going to hire in the middle," he says. For junior-level staff, he sees hedge funds as "another magnet" because they offer the chance "to make big money fast."
For his part, Ard has his eye on financial sponsors - the large private equity firms whose assignments generate large fees for investment banks. In addition, he sees most areas of commodities continuing to hire.
One way banks are managing headcount is by working people harder. One recruiter says that Lehman Brothers, in particular, has developed a reputation of "doing a lot with a little."
"Firms would rather be understaffed than overstaffed," observes Johnson. In some, "there's a clear view of 'work them until they drop, and then we'll hire more people'."