It's like many things headhunters say, sort of true
Firstly, as anyone who has read the P&D guide to quant careers will know, we recommend all newbies to try the direct approach. That's partly because our philosophy has always been to tell it straight, and also because we don't really see them as a threat.
Most large banks have their own inhouse recruiters, and they are what they are. Although at one level I guess I'm supposed to see them as competition, I'm British and thus have a genetic predisposition towards the underdog.
In theory this could be a real threat to my business, but the reality is more complex, but in a faintly amusing way.
They are pathetically dependent upon social networks since their firms won't provide them with basic resources.
By 'basic' I mean things like business cards, yes, really. The first time I came across an inhouse who wasn't allowed to have cards I felt sorry for the poor guy and gave him the address of the firm who prints ours who are cheap enough that he could print his own.
When your competitors are sympathetic and take you out for a beer, you are in the wrong job.
They don't have budgets to go to conferences, often no admin support of any kind, and then there is the technology which varies from zero to awful.
This summer one of the largest firms vaguely tried to headhunt me to run their inhouse quant / trading recruitment, and this caused me to review this area of the market.
Inhouse recruiters usually come under HR, which is no suprise, but since I'm dealing with an audience of mostly entry level people, I should amplify what that means.
HR bonuses are not the highest in the bank, typically amongst the lower end of back office.
Partly because HR is not revenue generating, but the politics are such that it's very hard for a HR to be seen to do an excellent job, but the nature of the work is that it is easy to get caught in a tier 1 screwup.
So the pay of an inhouse recruiter is not good, at all.
A rational way to pay one is along the same lines as if he were working for recruiting firm, bonus dependent upon the number and level of people he recruits.
Dream on, the money isn't like that at all.
Also there is no real possibility of promotion. As a matter of full disclosure I would make the worst head of HR for a bank in the history of the world, an admission that shocks no one who knows me. Ditto most HHs.
So you have a badly paid dead end job.
Do you expect the best HHs to go for this ?
A firm like GS could hire whoever you think is the best HH in the world saving them millions and still paying enough that he says 'thankyou' when you make the offer. Trust me, they don't.
Also whatever you think of HHs in the free market, we compete with each other. That means hiring managers get something like the service they want.
Monopolies as we all know deliver high cost, low quality output.
But you may notice that I didn't say that inhouse recruiters were crap...
It's a tough market for HHs, and my guess is that somewhere between 40 and 60% of the people doing it three years ago aren't doing it now.
Working for a bank is a
great way to build up a database of people you can headhunt because you get copies of the CVs sent in by other recruiters, and you have a complete list of people who work for your own bank.
That's not very legal, depending upon where you are maybe a criminal offence, but it's also utrrly inevitable.
