Boston is no longer an oasis of calm amidst the maelstrom of the financial markets. Major employers like Fidelity Investments, MFS Investments and Bank of New York Mellon Corp. have all announced layoffs. Other companies, including MassMutual Financial Group and Putnam Investments, have announced management changes.
This uncertainty marks a change for the region. Until recently, area recruiters indicated many workers from outside of New England were trying to return because employers there were seen as more stable. Given the market downturn, that perception has changed: Now even people with jobs are seeking out recruiters in droves.
"The outplacement industry is experiencing a significant uptick in business," says Elaine Varelas, managing partner of Keystone Partners, a career management firm based in Boston. "We see this instability continuing through at least first quarter 2009."
The New England Economic Partnership recently offered a gloomy assessment of the region's economy, projecting the financial sector would lose 9,000 jobs over the next year and a "significant recession with difficult challenges ahead for the New England economy."
"Using hedge fund terms, we are long on supply," observes Elizabeth Komachi, a Boston-based partner with Heidrick & Struggles. "This market has done bad things to talented people as much as it's done bad things to good firms."
Earlier this year, JPMorgan Chase announced plans to add 300 workers at its Fund Services Business in Boston over the next five years. The New York-based banking giant plans to lease approximately 100,000 square feet in South Boston. Whether those plans have changed recently couldn't be determined.
Putnam, which like Fidelity has been battered by poor returns in the stock market, recently unveiled what it termed a "broad restructuring of its equity investment unit," which resulted in 47 jobs being eliminated. Newly appointed Chief Executive Robert Reynolds merged six mutual funds into larger funds and revamped the firm's compensation packages. Fund managers that achieve "top quartile returns consistent with fund mandates" can be eligible for full bonuses, the company says.
Many of the jobs being filled are replacements, not new positions, says Matt Naughton, an executive recruiter with the Boston office of Ajilon Finance. For job seekers, Naughton doesn't see much to be optimistic about. "It's rough out there," he says.
Naughton urges candidates to resist the temptation to phone his office every day. Instead, check in every few weeks. The more time recruiters spend speaking to clients, the less they have available to devote to finding them jobs, he points out.
For now, recruiters are bracing themselves for a rough market. However, Komachi sees a potential silver lining, though it's not very bright. "We have some belief that companies over-fire in downturns," she said. "That presumably cycles back."