It's freezing out there

13 September 2007

2 minute read

Seems that just about every bank has got a hiring freeze on.

Earlier this week, The Telegraph ran a story saying Citi, JPMorgan, ABN AMRO and Soc Gen have all put a stop to hiring for the time being. Our own enquiries suggest the freeze is a lot more widespread than that.

In addition to the banks mentioned by The Telegraph, headhunters say everywhere from Credit Suisse, to Merrill Lynch, Deutsche, Goldman Sachs and Bear Stearns have stopped recruiting for the moment. Morgan Stanley, meanwhile, is rumoured to have had a freeze on hiring since June, albeit only for fixed income.

It's bad news for anyone who's in the process of applying for a new role, but didn't managed to get in before the frost struck. Lots of candidates have gone through to final round interviews, only to have offers rescinded until hiring resumes in January - assuming it does.

"Deutsche Bank announced a global hiring freeze last Friday," complains one recruiter. "They'd paid for someone to fly over for an interview and we had to cancel the flight."

It's also bad news for headhunters, who are now faced with scores of uncompleted mandates. With most candidates unlikely to resign until bonuses have been paid in February and March and then unable to move until notice periods have elapsed in June, headhunters face a wait of up to 10 months before they can collect full fees on a search.

However, some say the freeze isn't absolute. "Hiring is still going through for special cases," says Zaheer Ibrahim, a consultant at Kennedy Associates. "It's a bit of a weird one," says another recruiter. "They've officially got hiring freezes, but if they need a replacement hire or there's an urgent position they will still recruit people."

AUTHORAnonymous

Insider Comment

HH
HH FF London
14 September 2007
Tarnishing all headhunters with the same brush is about as arbitrary as taking Mr Bud Fox to be representative of the in-dividuals in his field: such generalisation smacks of an immensely immature approach. Incidentally, I am a headhunter, having declined an offer in the derivatives space with a Top Tier institution for this more short-term lucrative option- given my plan is to return to complete my PhD in Electric Propulsion systems before undertaking further research. A 'wannabe banker'? I'd rather not, thank you.
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AE
AE - Search Consultant
14 September 2007
Agreed Shaun, self-regulation is the best way to upgrade our standards. Though I feel a Centralised Authority will only exacerbate a 'back alley' of recruiters whom neither wish to subscribe nor conform to high standards (much as there are now!). Better, I feel, would be a standardised contract that encompassed the best aspects of search and selection procedure binding both client and consultancy to best practice and best outcome... After all, we are all at the mercy of the markets and all looking to manage volatility and market abuse. A shakeout has been overdue and hopefully any rotten apples will fall. My own experience is that retainers are still around and banks will still make some pretty healthy profits, however they will use this opportunity to manage bonus expectations and cut costs where they may not have done before.
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VK
VK
14 September 2007
Lighten up folks!
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He
Hedgiehunter
14 September 2007
We're still busy, having an amazing year, well on target to double our turnover from last year's figures.
Suffering a bit from the credit crunch though, a lot of our clients are credit hedge funds and therefore recruitment's being frozen. One person's loss is another persons gain however, especially in the volatile HF space.
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Sh
Shaun
14 September 2007
Yes there are hiring freezes out there. No it is not pandemic. Yes there will unquestionably be a recruiting downturn which will likely last throughout the next four or five quarters. Yes some headhunting companies will go the wall because they deserve to or because they have business model that is only sustainable in a boom or because they have no idea how to operate in a downturn.
Frankly I find the withering fire directed at Paul to reflect as badly on the search industry as his acerbic comments do on him. All of us in the unregulated and low entry level search industry know that our professional and respectful approach to our clients and candidates is often undermined by characters with whom Paul has probably had the misfortune of meeting. If we don't want to hear comments like Paul's then we need to clean up our own act and have a centralised authority to whom complaints can be made and action taken.
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