International investment banks have pressed the pause button on Gulf hiring plans
Investment bankers in the Middle East hoping for increased employment opportunities in 2011 were relying on one key factor - a strong start to the year. Sadly, this hasn't happened.
M&A activity in the Middle East declined by 42% in Q1 this year compared to the same period in 2010 and equity capital markets - already struggling after a woeful year - slipped by 13% to $1.3bn, according to figures from Thomson Reuters.
The reasons for this are fairly obvious - the unrest sweeping through the region since late January has made conditions particularly difficult for investment banking activity.
From a recruitment point-of-view this is problematic. In the first couple of months of the year, there were signs that 2011 was shaping up to be a good period for hiring. However, the flow of new roles coming out of international banks has now largely stopped.
"There were a lot of roles for coverage bankers in the first two months of the year, but US banks in particular have become very cautious about hiring in light of recent events," says Jonathan Gould, manager - financial services at Morgan McKinley. "Some banks have semi-official hiring freezes, and some roles have been put on hold."
Perhaps more disturbing are increasing numbers of reports that banks have pulled roles already mandated to recruitment firms and, in some cases, rescinded offers.
"One international bank made a verbal offer to a candidate and then pulled it simply because of the unrest in Bahrain," says another financial services recruiter. "But it's working the other way - one candidate reversed his decision to relocate from Madrid to Dubai because of the trouble in the region."
The question is whether the banks will restart these hiring plans if things calm down in again the region this year. Q1 is typically the most active period of recruitment, with little activity taking place from June to November due to the expat summer exodus and religious holidays such as Ramadan.
Recruitment by international investment banks is not completely dead in the water currently, however. Banks are still recruiting selectively in countries they feel are strategically important.
"There's been a change of focus with demand increasing for people with experience and contacts in Qatar, Saudi and Abu Dhabi," says James Wakefield, director of headhunters Cobalt Abu Dhabi.
