Does demand for restructurers point to downturn?

Like hearing a cock crowing on the morning of a wedding or spilling salt, some things are held to be harbingers of bad luck. Equally, news that banks and boutiques are hiring restructuring staff in London doesn't augur well for the future of the UK economy.

"Restructuring boutiques are hiring in London for two reasons," says Logan Naidu, a consultant at recruitment firm the Cornell Partnership: "Firstly on the back of increased private equity investments, and secondly because they're expecting a market downturn in the next 12-18 months."

"There are a number of investment banks and boutiques trying to build their restructuring expertise right now," says Krista Parker, a consultant at Badenoch & Clark. "The market is buoyant and there has been a definite increase in appetite for hires."

Parker works for Houlihan Lokey Howard & Zukin, the US-based restructuring boutique which opened a London office in 2002. She says the boutique has hired consistently ever since, and that investment banks are also seeking to build restructuring teams currently.

Among them is Lehman Brothers, which recently relocated Michiel Post from New York to London to work in its European restructuring team. The bank is looking to hire a number of analysts to work in the area.

Close Brothers, one of the leaders in the UK restructuring market, has also been recruiting. In December, it hired Alain LeBerre from Ernst & Young as a director in its European special situations group.