Australia: 2008 year in review

Good(ish) year

Risk management and compliance

As wickets tumbled at the other end throughout 2008, compliance professionals played a steady, resilient innings. Banks woke up to the fact that compliance is critical. "Risk management employees have been valued," says Jacob Smith, manager, risk management and compliance at Robert Walters. "They can be seen to be responsible for either preventing or assessing the severity of impacts arising from global economic disruptions."

M&A (comparatively speaking)

The M&A sector performed reasonably well for most of the year. Recruitment activity was strong earlier in 2008, across the major banking groups as well as smaller boutiques and mid-market players, says Melissa Tal, a recruiter at Michael Page International. "Demand was highest at the analyst and associate level with consistent but more limited activity for senior roles. As the year progressed and the economy slowed, recruitment demand from the large banks tightened, although this was offset to a degree by the continued growth of boutiques," she adds.

Attracting bankers back to Aus

While 2008 was far from a fine year overall in Aussie recruitment, at least it wasn't as bad as in Britain. Australia actually managed to claim back some of the bankers it had lost to London during the boom years. Oliver Darkes, principal consultant at Carmichael Fisher, says Australians returned home because banking-sector redundancies were proportionally lower here than in the UK. But London refugees should be warned. "The absorption rate into jobs is now a lot lower than it was in the middle of the year. You're not going to get a hug at the airport and a limo to UBS any more," adds Darkes.

FX

FX remained a comparatively profitable and liquid industry in 2008. "The employment market is tough, but less so than other asset classes. Because there are no short-selling bans in most major FX markets, unlike equities, it remains a good speculative instrument," says Luke Heath, chief executive of Chandler Heath Executive Recruitment.

Bad year

The back office

Non-revenue generating staff felt the pain before their deal-making cousins. Banks began by freezing headcount, and then in Q4 they started laying off operations professions in large numbers, says Tal. Redundancies at Big Four banks put a lot of quality ops candidates on the market in late '08, with some support sectors hit harder than others. "The credit crunch has impacted prime broking and equity finance businesses, so demand for stock loan and prime broking operations/client services candidates is expected to slow," says Liz Mellor, senior operations consultant, Morgan McKinley.

Debt and equity

As the credit crisis unfolded, debt markets were hit first, with structured credit, securitisation and leveraged finance teams amongst the sectors targeted for layoffs. Transaction-focused roles in corporate finance came under pressure from the middle of the year as funding issues impacted deal flow, says Tim Beach, a banking specialist at Robert Walters. "In the latter half of the year a sharp correction in equities markets, accompanied by decreased liquidity and increased volatility, led to headcount reductions across equities and structured products teams, in both banks and fund managers," he adds.

Funds management

Funds management companies endured a torrid 2008. As the year drew to a close there was almost no new hiring in the sector and in many cases non-essential staff were trimmed, says Lee Humphrey, a fund management principal at Derwent Executive. "We are seeing compensation levels pared back, this though is mostly in the 'at risk' or variable components of a package. Fixed components, base salaries, broadly remain unchanged. Managers recognise that when things turn they will turn pretty quickly," he adds.

Project roles

From the second quarter of 2008 onwards, as the economic uncertainty increased, banks began delaying their project budgets. As a result, demand for project-role candidates slowed, predominantly at the senior programme manager level, says Vanessa Harding-Farrenberg, joint managing director of Morgan McKinley's Sydney office.

Convincing candidates to move jobs

It was tough being a recruiter in 2008, not only was hiring pulled back, but candidates got cold feet about moving. "Confidence in the employment market has definitely been hit," says Patrick Everest, a partner at Jon Michel Executive Search. "It's been a challenging back half of the year...For candidates who are currently in roles, there must be a compelling case to consider a move. Either a significant promotion, a different/more interesting role or a pay rise - which generally aren't happening at present."

Jobs at Babcock & Brown

In a fourth quarter dominated by mass layoffs, B&B's axings stood out from the crowd. It plans to cut 850 jobs by 2010, leaving it with just 650 employees. That's if it survives at all.