New Hires' Pay Seen Dropping 20 Percent
If you get a job offer on Wall Street, the compensation may be roughly 20 percent below what you could have commanded a year ago.
That's the upshot of a new survey of recruiters released this week by the smart cube, a London-based global research boutique. The survey aimed to pinpoint and quantify how the market downturn is affecting employer and candidate expectations and bargaining power, particularly in terms of compensation.
In the U.S., the smart cube said, "More than 40 percent of recruiters surveyed expect compensation will decline by as much as 20 percent, while 22 percent expect the decline to range between 11 to 16 percent. About one-fifth of the survey's respondents were less pessimistic, predicting a decline of less than 10 percent."
In the UK, 50 percent of recruiters expect compensation for new hires will decrease by at least 16 percent; among that group, half of those predict the decline will exceed 20 percent.
'Clearly a Buyers' Market'
"With Wall Street unemployment steadily rising, the job market pendulum has clearly shifted in favor of employers," said Omer Abdullah, the smart cube managing director who oversaw the survey. "We are operating in what is clearly a buyers' market that appears likely to continue for at least the short to medium term."
Among other signs of the times:
- Some recruiters cited a trend to slash or even eliminate signing bonuses for new hires.
- The hiring process is taking considerably longer, and firms are more often hiring temporary or contract employees rather than offer permanent jobs.
- "Investment banks will only recruit new employees in areas where there are critical openings that absolutely need to be filled."
- Candidates fear pricing themselves out of the market. "Wall Street job candidates, especially at more senior levels, have significantly scaled back their compensation demands and are considerably more cautious about making them," the release says.
- Many finance pros have lost the once-widespread lust to jump ship. "Employees with secure jobs are considerably less receptive to accepting new positions elsewhere," says the release.
- No one is safe, apparently: "Recruiters couldn't identify job functions they believe are relatively secure."
- Still, most recruiters view the current Wall Street job downturn as less severe than the previous downturn triggered by the collapse of the dot.com bubble.