The financial community was shocked at the magnitude of the layoffs announced by Deutsche Bank last month. Employees worldwide came to work that Monday to the news that 18,000 of them would be let go over the next three years as part of a plan to exit certain lines of business in its equities division.
People who work on Wall Street know that the landscape has been changing for a while now. The financial crisis of the last decade has given way to a more secular phenomenon. Algorithms are replacing traders, passively-managed investments are growing at the expense of actively-managed investments, and regulations like MiFID are taking a toll. Many jobs are going away, and when they’re not, people are often getting paid less to do them.
In the decade prior to the Great Recession, most job switching was tied to recruitment into more senior and more lucrative roles. But, in the most recent decade, job switching has shifted to be more about survival in reaction to the financial crisis and the numerous rounds of restructuring that followed.
The thousands of qualified financial professionals from DB hitting the streets will add considerable stress to a sector that is already challenged. More junior professionals will struggle to find comparable work at other banks. For more senior professionals, finding comparable jobs might be a fight they can’t win.
There is a lot at stake here. I know altogether too many former Wall Street professionals who have not successfully adapted to the new environment. I am talking about very capable people who graduated from top schools and had great Wall Street careers – up until a point.
It’s a battle between the ego of very successful people and the harsh reality of the situation. Sometimes, they need somebody — an insider who really knows Wall Street — to tell them what that reality is. It’s the glaring truth that there isn’t going to be a seat for everyone in the current game of musical chairs. For every star trader who lands a comparable position, there are going to be two or three who don’t. And won’t.
And for those people who find themselves standing when the music stops, it’s hard to understand how to change jobs or even careers.
Now, here is some good news. There are many great ‘new economy’ companies that recognize the value of Wall Street professionals and need talent in key roles. How can you take advantage of these opportunities?
Here’s a good place to start:
Don’t let your ego get in the way. The stakes are high. Be honest with yourself.
Think ahead. If you are not in transition, but see the writing on the wall, start making a plan.
Have a Plan B. I call it dual tracking. Yes, you still are looking for a comparable position in finance. But the reality is, you might not find it. Having a solid Plan B in place while also going for Plan A means you’re not at sea if Plan A falls apart.
Be flexible. Don’t let the compensation you are used to stop you from pursuing an exciting second career. It may take time, but there are a lot of ways to create wealth in the long run.
Don’t do it alone. Most of all, and I’m “talking my book” here, make sure you get professional career coaching. Work with a firm that has a track record of helping people make this specific type of transition. Don’t be shy about asking your employer to provide career transition support as part of a separation agreement, aka outplacement. Or, if not possible, hire a suitable career management firm on your own.
At GetFive, we are uniquely positioned to support financial services executives in this era of transformation. I was a Wall Street analyst for 20 years before acquiring GetFive. Our financial services coaches are former Wall Street executives and managing directors. They speak the language of your industry, understand your mindset, and have the depth of experience you require. No one understands financial services career transitions better than we do. To learn more, contact us.