As the UK deals with the fallout from Brexit, U.S. financial services professionals in the City are looking to orchestrate a move home. But with Wall Street banks dealing with their own problems, how feasible is this currently?
“For those American bankers who transferred to London for a ‘European adventure,’ this might be coming to an abrupt end,” said Anthony Keizner, partner at Odyssey Search Partners. “Unfortunately, given the weak hiring market in the U.S., it’s also not certain that there will be spots in New York to absorb those looking to return.”
The problem for U.S. bankers looking for a return home right now is that many companies are currently holding fire on hiring decisions until the uncertainty over Brexit starts to subside.
“We don't think there's going to be any rush to judgment to immediately pull back staff from London or curtail any hiring plans here in the U.S," says Anne Crowley, managing director at Jay Gaines & Co. “What Brexit does produce is a period of uncertainty, which may prompt firms to pause new initiatives in a wait-and-see mode, but don't think there will be drastic cuts or changes near term.”
“When banks are unsure of what happens, a hiring freeze is the most common response,” said Peter Laughter, the CEO of Wall Street Services. “Until there is some semblance of clarity on what happens next, we can expect banks to be very cautious about hiring as a first step."
Longer term, recruiters are optimistic that the impact of Brexit on financial services recruitment in the U.S. will be minimal and are likely to opportunistically target expat talent in the UK.
“This could, in a messed up way, be a positive for the U.S., as the number of candidates looking to come back here will increase, and hiring needs here may also increase due to relocations," Mia D’Angelo, a recruiter at Infinity Consulting Solutions.
But it's not simply a case of London's banking recruitment market sliding and Wall Street taking up the slack. For a start, headhunters tell us that the ongoing slump in M&A and equity markets, together with the need to cut back trading teams globally, has meant that the situation is no better state-side than in the UK. Brexit may have exacerbated relocation of jobs to other, often cheaper, European financial centres but these cuts would have happened anyway.
"Financial services firms are cutting on an ongoing basis, and some firms may be using Brexit as a 'reason' to take steps they were already planning, regardless of Thursday's vote," says Crowley.
“Whenever there is uncertainty in the marketplace, whether it is from Brexit or whatever issue du jour spooks the markets and the economy, it’s easier for companies to sit on their hands, especially because we’re in the summer when things slow down somewhat,” said Jack Kelly, managing director of Compliance Search Group. “The season coupled with Brexit means that it’s easier for firms and candidates to sit on the sidelines."
It's tempting for American bankers to flee London during a crisis hitting the UK, but it may be a bad move.
"With or without Brexit, London is still the financial capital of Europe and that is unlikely to change. I don't expect that to change unless the UK enacts absurdly difficult work visa requirements," said Peter Laughter, the CEO of Wall Street Services. "For Americans working in the UK, I don't expect an immediate and drastic change in employment.
"It is possible, however, that Brexit would increase the number of opportunities for Americans working in the UK should it become too difficult for other Europeans to get work authorization," he said.
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