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Helping Wall Street's Newly Jobless

September 30, 2008
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Related Topics: Downsizing, Career Development, Candidate Sourcing, Employee Career Development, Featured Article, HR & Business Administration
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With hordes of suddenly jobless financiers knocking at her door every day, Cheryl Yung is working flat out.

In more than 10 years as a career coach specializing in helping sacked investment bankers rebuild their careers, Yung has never seen anything close to this. After the collapse of Lehman Brothers and rapid acceleration of layoffs all across Wall Street, her work now stretches to 12 hours a day and into the weekends.

"The word people on the front lines use around here is ‘bloodbath,' " says Yung, a senior vice president at outplacement firm Lee Hecht Harrison.

The tumult is shifting into overdrive at the companies that help people reassemble their professional lives. The outplacement industry, created largely to serve displaced workers in the Rust Belt, has been becoming white collar-and moving eastward-in recent years.

In the past 12 months, more than 20,000 New Yorkers have lost their Wall Street jobs.

Thousands more are certain to follow in the coming weeks, including as many as half of the 10,000 former Lehman employees now at Barclays Bank under 90-day contracts as the British owner sorts out its staffing needs. Major layoffs also loom at Merrill Lynch as it is merged into Bank of America and at American International Group, which was effectively nationalized.

"Every industry takes its turn for big restructuring and layoffs," says Celeste Calfe, president of the Association of Career Firms North America. "It's finance's turn now."

Many banking industry executives are warning recently laid off Wall Street workers that their former jobs won't return anytime soon and they should cast their lots elsewhere.

The tough part is finding positions that pay anywhere near the ones that saw the average Wall Street employee collecting $180,000 in bonus pay alone last year.

"In the past, there was a belief by people like me that you ride the cycle, cut people and expenses when you need to, and when it's over you rehire," says Jim Fitzgerald, Wachovia's regional president for wholesale banking in New York and Connecticut. "That's not going to happen this time."

 Networking no longer an option
    For those who assist the professional casualties of Wall Street's implosion, the problem is not simply the volume of displaced workers. Experts say job opportunities are evaporating all across finance.

"In the past, people got jobs through networking, but now there's nowhere to network to," Yung says.

Generally, financial institutions pay for up to six months of career transition services, which don't come cheap.

Counselors typically charge individuals $500 just to review a résumé, according to Calfe. Outplacement has grown into a $10 billion business worldwide with more than 800 firms, including leaders Lee Hecht Harrison, Right Management and DBM Career Services.

Those who have just lost Wall Street jobs at first tend to view her much like they would a doctor, Yung says. They welcome the help but at the same time are fearful of what they might hear-and she often delivers a bleak prognosis about their staying in finance.

In the end, many financiers will follow in the footsteps of people like Angela Jameson. Laid off late last year by Moody's Investors Service, where she had worked for 15 years rating the credit of such retailers as Wal-Mart, Jameson began attending weekly two-hour meetings at Lee Hecht Harrison with half a dozen other displaced executives.

Changing careers
    "I had to go before these people and account for everything I did while looking for work-interviews, conversations, networking," Jameson says. "It meant I had a goal."

Her focus paid off this spring, when she landed a spot as a researcher at the International Council of Shopping Centers, a trade group.

Others have had to reinvent themselves.

After UBS laid him off, Frank Lugossy bought a wine shop last year in Greenwich, Connecticut. The former equity trader, whose inventory includes bottles of Sauterne and Cheval Blanc, says sales are robust.

"For sure, it's not the same pay as Wall Street," Lugossy says. "But I like working for myself now."

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