Wall St. Hiring in Anticipation of an Economic Recovery

As hiring has picked up on Wall Street, salary packages recalling the boom years are reappearing at the most senior levels. Richard Stein, president of Global Sage, an executive search firm, said corporate clients had offered compensation packages worth more than $1 million annually to 12 candidates in recent weeks.

The hiring is not just a local phenomenon. Major investment banks are quietly rebuilding their global work forces.

Goldman Sachs added 600 jobs worldwide in the first quarter, while JPMorgan’s investment bank has hired slightly more than 2,000 people globally since the beginning of the year.

Closer to home, Credit Suisse’s investment bank, based in New York, filled 600 positions in the first quarter, with a significant portion in New York. Deutsche Bank has hired 414 people in New York, including 98 directors and managing directors since the start of the year.

Hiring is also picking up at boutique firms and at smaller foreign banks seeking a beachhead in New York.

Nomura of Japan has been especially aggressive, recently hiring several top bankers from Deutsche Bank. Nomura’s New York-based securities unit has increased its staff to more than 1,700, from 1,000 in March 2009, and the bank says it will hire 300 more workers by March 2011.

Macquarie, an Australian investment bank, has also rapidly expanded, even taking over new floors in its Midtown Manhattan headquarters to accommodate new trading operations. One morning last week, long rows of traders there worked the phones and watched a multitude of screens, evoking the heady days before the Bear Stearns and Lehman Brothers downfalls.

“We are very bullish on the U.S.,” said Tim Bishop, who leads Macquarie’s United States operations.

On Thursday, Macquarie added six fixed-income traders in New York, and it plans to announce the hiring of six equity traders on Monday.

At Centerview Partners, a boutique investment bank that specializes in corporate advisory work, 10 bankers have joined the firm in New York this year, bringing its roster to 75. “I think hiring has turned the corner,” said Blair W. Effron, a former UBS vice chairman who was a founder of Centerview in 2006.

To be sure, Wall Street has long been the quintessential boom-and-bust industry, hiring rapidly on the way up and shrinking even more quickly on the way down.

Employment in the securities industry in New York was at 160,400 in May, up from the trough of 158,500 in February, but still well below its peak of 188,900 in January 2008, according to data prepared by the state comptroller’s office.

As the nascent increase in jobs suggests, the recovery is still very fragile. And executives say it could halt or even reverse if earnings reports for the second quarter, which begin this week, are disappointing.

As a result, some banks are hiring in stages, with one eye on the economy. In recent months, Morgan Stanley has hired 100 private bankers in the United States to serve wealthy clients but is holding off on plans to hire 400 more, waiting to see how the market performs.

Of 400 recent hires in the sales and trading unit at Morgan Stanley, for example, the bank says only 100 are traders.

Wall St. Hiring in Anticipation of an Economic Recovery - NYTimes.com
The premise of the article -- that hiring is taking place in anticipation of economic recovery -- is absurd and disingenuous. The world of finance -- artificially propped up with state help -- and the "real" world have become increasingly divorced from each other. I see no signs of "recovery" in the real world and indeed, the preconditions for such are lacking. Look at this ridiculous contention:

“I think we’re seeing some hiring in anticipation of better times,” said Rae Rosen, a regional economist at the Federal Reserve Bank of New York. “Wall Street typically hires in anticipation of the recovery, and there is a sense that the economy has bottomed out and is slowly improving.”

Ken Abbott

Managing Director
Wall Street hiring

The street is hiring. That's a fact.

What's relevant for readers of this forum is that many of the positions require quantitative skills, but are not necessarily trading positions nor positions that will lead directly to trading jobs.

Too many people seem to think that their MFE or MS in QF will get them that quant trading job at a big firm. That's not where the jobs are. The jobs are in model support, model review, risk management, valuation review and audit. These are good jobs that are intellectually rewarding and pay well (given performance).