Investment bankers flee jobs bloodbath in the City

Investment banks are laying off staff, and the workers are looking to change sector entirely as a result
Investment banks are laying off staff, and the workers are looking to change sector entirely as a result Credit: Jason Alden/Bloomberg

Growing numbers of investment bankers are seeking sanctuary in other industries, as the latest round of cutbacks suggests the sector is shrinking permanently.

The investment banking sector is highly cyclical, with workers hired en masse when times are good, but fired rapidly in a downturn.

This time, however, increasing numbers of workers believe the industry’s woes are structural and the jobs may not return in such numbers next time there is an upswing.

Banks including HSBC, Deutsche Bank, Morgan Stanley and Barclays have cumulatively cut thousands of investment bankers in London and around the world in recent months.

Recruiters at Morgan McKinley have seen an 8pc drop in the number of new financial services jobs on their books over the past year, with just 7,695 available.

At the same time the number of jobseekers has climbed by 36pc on the year to 13,454.

“There is an argument to suggest that the redundancies that have been announced over the last six months are contributing to the higher numbers of professionals now seeking new employment,” said Morgan McKinley’s Hakan Enver.

“At the same time, there are more individuals inquiring about opportunities outside of the investment banking arena, perhaps pre-empting the possibility of a Brexit.”

One particular driver of post-Brexit employment could be a surge in deal levels.

Fewer companies have floated on the stock market in the UK ahead of the referendum, or even raised money on the market.

Similarly, fewer have engaged in mergers or acquisitions – buyers and sellers, as well as other investors – are not keen to do big deals when the price could change with the vote on 23 June.

As a result, there could be a cyclical upswing in hiring after that date.

Other parts of investment banking are less likely to bounce back. Morgan McKinley estimates that banks’ revenues from trading bonds, currencies and commodities have fallen 49pc in the past five years and headcount has fallen 33pc.

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