STREET'S GLOOM
LAYOFFS DRAIN CITY'S ECONOMY
By KAJA WHITEHOUSE
Last updated: 2:50 am
June 29, 2008
For tens of thousands of recently pink-slipped Wall Streeters, the forecast for the rest of the year calls for rising personal expenses, a storm of bills coming due - and few job opportunities.
At least they can get a good deal on a summer house rental.
Job cuts in the troubled financial services sectors hit 66,031 through May 31, according to Challenger, Gray & Christmas, and are threatening to break last year's grim mark of 153,105.
People caught up in the first few rounds of cuts, back in August and September, were fortunate enough to be hacked at a time when the larger economy had yet to feel the effects of the subprime collapse, experts said.
But as Wall Street's bloodletting continues and previously healthy sectors fall under the dual pressures of rising gas prices and drooping consumer demand, the latest victims of Wall Street's subprime slime- including 6,500 Citigroup investment bankers - may have a far tougher time getting another job.
"When you see a company like Goldman Sachs announcing layoffs you know things" have gotten bad, said John Challenger, CEO of the outplacement firm.
Challenger is referring to last week's news that Goldman Sachs, one of the few financial firms largely unscathed by the collapse of subprime, is laying off 10 percent of its investment banking staff due to a slowdown in business.
Even hedge funds and private equity firms, traditional alternatives for former Wall Street execs, are no longer safe havens. Hurt by the credit crunch and volatile financial markets, hedge fund launches at the start of the year slowed to their lowest level in eight years, according to data from Hedge Fund Research.
And those fortunate enough to nab a job in those industries are receiving lower salaries than they would have a year ago.
"Private equity and hedge funds are upgrading talent at this time," said Michael Magsig, with executive recruitment firm Korn/Ferry International. "They can get more seasoned people at a lesser cost, frankly, than what that talent might have cost them" before the downturn, he said.
The layoffs could drag down the city's economy even further. Add to the pink slips the fact that Wall Street's generous severance checks to the jobless will soon stop, said Jeff Weissenstein of the New York State Department of Labor.
"This is probably just the tip of the iceberg," said Weissenstein.
By KAJA WHITEHOUSE
Last updated: 2:50 am
June 29, 2008
For tens of thousands of recently pink-slipped Wall Streeters, the forecast for the rest of the year calls for rising personal expenses, a storm of bills coming due - and few job opportunities.
At least they can get a good deal on a summer house rental.
Job cuts in the troubled financial services sectors hit 66,031 through May 31, according to Challenger, Gray & Christmas, and are threatening to break last year's grim mark of 153,105.
People caught up in the first few rounds of cuts, back in August and September, were fortunate enough to be hacked at a time when the larger economy had yet to feel the effects of the subprime collapse, experts said.
But as Wall Street's bloodletting continues and previously healthy sectors fall under the dual pressures of rising gas prices and drooping consumer demand, the latest victims of Wall Street's subprime slime- including 6,500 Citigroup investment bankers - may have a far tougher time getting another job.
"When you see a company like Goldman Sachs announcing layoffs you know things" have gotten bad, said John Challenger, CEO of the outplacement firm.
Challenger is referring to last week's news that Goldman Sachs, one of the few financial firms largely unscathed by the collapse of subprime, is laying off 10 percent of its investment banking staff due to a slowdown in business.
Even hedge funds and private equity firms, traditional alternatives for former Wall Street execs, are no longer safe havens. Hurt by the credit crunch and volatile financial markets, hedge fund launches at the start of the year slowed to their lowest level in eight years, according to data from Hedge Fund Research.
And those fortunate enough to nab a job in those industries are receiving lower salaries than they would have a year ago.
"Private equity and hedge funds are upgrading talent at this time," said Michael Magsig, with executive recruitment firm Korn/Ferry International. "They can get more seasoned people at a lesser cost, frankly, than what that talent might have cost them" before the downturn, he said.
The layoffs could drag down the city's economy even further. Add to the pink slips the fact that Wall Street's generous severance checks to the jobless will soon stop, said Jeff Weissenstein of the New York State Department of Labor.
"This is probably just the tip of the iceberg," said Weissenstein.
Labels: layoffs, New York City, Wall Street
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