Competition for Jobs Heats Up in Boston
Boston-area investment firms aren't hurting for resumes. Thousands of bankers laid off from Wall Street firms are eager to make a change to areas of financial services that appear to be weathering the economic downturn, such as private equity, venture capital or hedge funds. Moreover, people living in New York - especially those with ties to New England - are willing to relocate to Boston, making the job market there even more competitive.
"The firms in Boston tend to be able to hold out longer and tough it out more," says Denise Palmieri, director of client relations for recruiter Pinnacle Group International in Scottsdale, Ariz., which works for firms in New England. "There is less feel of a panic in Boston than there is New York."
'A Well-Networked Town'
Indeed, few of Boston's investment firms have conducted layoffs, unlike many of New York's bulge brackets. (Of course, they employ far fewer people.) However, some hedge funds are liquidating and some private equity deals, such as the $17.9 billion buyout of Clear Channel Communication Inc. by Boston's Thomas H. Lee Partners LP and Bain Capital Partners LLC, have had difficulty closing. The volume of venture capital deals also is declining.
"There are probably plenty of opportunities for people, but it is a well-networked town," observes Elizabeth Komachi, a Boston-based partner with search firm Heidrick & Struggles. "There are still hedge funds that are starting. There are still asset management firms that are in the market looking for talent. They (candidates) find a way to the employer without the help of a recruiter."
"If all the money from the first fund's management fees is already allocated, the only way the firm has money to hire new employees is if the partners agree to give up part of their salaries to pay for the new guy," Komachi notes. "As a result, they typically don't hire until they have a new fund."
As a result, firms typically don't hire unless they have a new fund with more fees or if someone leaves. Hiring slows down if they aren't able to raise money for a new fund, or they receive less than they expect.
Fund-raising difficulties forced a client of Boston recruiter Alex Cook of Conley & Co. to put off a hiring decision. "The candidate they have been speaking with is 100 percent perfect," says Cook, who heads the firm's asset management practice. "Still, it's a business decision."
Despite Boston's generally calmer attitude candidates, particularly those with a banking background, may face tough sledding. Over the past year, the job market has changed to favor employers, which has come as a shock to younger candidates who've never experienced an economic downturn. Moreover, there are plenty of candidates available for hedge funds, private equity players and venture capitalists with direct industry experience.
"It is definitely an employer-driven market as opposed to the candidate-driven market that it was last year" says Palmieri. "(Recently), we had a candidate who was looking for a sign-on bonus. We said, 'sign-on bonuses are a thing of the past.'"