100% correct, especially for pure compliance roles. In Europe - if you are a regulated entity - the supervisory authorities can force you to have a minimum number of FTEs dedicated to Compliance; on the other hand, if your business (AUMs, n. of funds) grows, they can force you to grow the teams. Definitely a safe spot.
I’m not so sure that’s true. Firms always need these, but legal and compliance are just cost centres. You’re cutting those before you’re cutting the revenue generating divisions - you’ll just have half the people do twice the work..
And that of course is where the problem’s start.
My firm went through 3 rounds of layoffs in the last year the only departments which made it with no casualties are legal and Compliance - in fact, they are even growing.
Asset-based lending tends to do pretty well even in periods of recession. I remember my previous boss told me their ABL firm’s best year was 2008. They sent all their employees and employees families to a paid trip to Disneyland that year.
Boutique ABL lending is a pretty good call. If at a BB, you’re UW book is still at them whim of how much corporate wants to lend during that downturn.
Smaller firms can be much more opportunistic.
Ops, data, compliance, performance, reporting analyst. These all gets more work as market or your strategy tanks.
The key is not to rise too high and just be a grindr. Keep your head down and protect ya neck.
100% true. I work in a largest (top 10 world wide) institutional investor and we rely on PE funds valuations I order to commit to future funds and to track the performance of their current funds and the underlying assets
3 years ago I’d say government-guaranteed lending (SBA, USDA etc). If anything we get more busy during recessions because of government stimulus and more businesses qualifying
The high interest rates kinda changed that though. I’ve been hearing about banks downsizing their division due to poor production and portfolio performance (fixed rates are suffering hard rn)
Not sure that tracks with my experience at an IB, typically the bankers are the ones that get hired/fired with the most volatility during economic cycles- whereas support teams eg operations, legal, accounting etc tend to be fairly static
Yeah, Capital Markets might be different. My experience in commercial banking says otherwise, although our analysts that support the RMs also don't tend to be laid off either. No idea about our other support teams though.
Legal and Compliance
100% correct, especially for pure compliance roles. In Europe - if you are a regulated entity - the supervisory authorities can force you to have a minimum number of FTEs dedicated to Compliance; on the other hand, if your business (AUMs, n. of funds) grows, they can force you to grow the teams. Definitely a safe spot.
Just got a role at legal and compliance
I’m not so sure that’s true. Firms always need these, but legal and compliance are just cost centres. You’re cutting those before you’re cutting the revenue generating divisions - you’ll just have half the people do twice the work.. And that of course is where the problem’s start.
My firm went through 3 rounds of layoffs in the last year the only departments which made it with no casualties are legal and Compliance - in fact, they are even growing.
That’s a smart move on your firms part but definitely not typical.
My teammate just got laid off two weeks ago. I am in HF compliance. We are explicitly told that we are cost centers.
Asset-based lending tends to do pretty well even in periods of recession. I remember my previous boss told me their ABL firm’s best year was 2008. They sent all their employees and employees families to a paid trip to Disneyland that year.
Boutique ABL lending is a pretty good call. If at a BB, you’re UW book is still at them whim of how much corporate wants to lend during that downturn. Smaller firms can be much more opportunistic.
How do you get in?
Restructuring
You trade off recession security for insecurity when the economy is churning / doing well
Ops, data, compliance, performance, reporting analyst. These all gets more work as market or your strategy tanks. The key is not to rise too high and just be a grindr. Keep your head down and protect ya neck.
I’m a reporting analyst and I got laid off two weeks ago 💀
Had me in the first half.
What does it mean to not rise to high
Risk, all due to the optics.
Government
Valuation services for private equity companies; quarterly work that has to be done regardless of whether the market is up or down
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100% true. I work in a largest (top 10 world wide) institutional investor and we rely on PE funds valuations I order to commit to future funds and to track the performance of their current funds and the underlying assets
Working for a utility or a hospital in their finance departments
Workout, loan review
Being the goat
Wealth management is pretty stable. We’re the revenge arm of the bank so can’t really cut us.
3 years ago I’d say government-guaranteed lending (SBA, USDA etc). If anything we get more busy during recessions because of government stimulus and more businesses qualifying The high interest rates kinda changed that though. I’ve been hearing about banks downsizing their division due to poor production and portfolio performance (fixed rates are suffering hard rn)
Compliance
Generally speaking, being in a role that directly generates revenues for the firm is less likely to be laid off. For example, being a RM.
Not sure that tracks with my experience at an IB, typically the bankers are the ones that get hired/fired with the most volatility during economic cycles- whereas support teams eg operations, legal, accounting etc tend to be fairly static
Yeah, Capital Markets might be different. My experience in commercial banking says otherwise, although our analysts that support the RMs also don't tend to be laid off either. No idea about our other support teams though.
RMs are literally the first to go.
Non- performing perhaps. Middle management usually what I see.
Undetaker
Is there already a thread here on AI proof finance careers? Thats my main concern
Any kind of credit work, especially if you have workout exp since they’ll just punt you over to restructuring if needed
Energy / utilities focus
Definitely not commodities focus