Wall Street's jobless pick themselves up
Ron Reede doesn't look unemployed. He dines on chicken salad at a well-known Wall Street restaurant. Midway through lunch, he excuses himself to call his lawyer. Yet for the past four months, this former commodity fund manager has been looking for work.
Up and down this city's financial district, the tremors from last October's market plunge continue to rumble. The thousands of workers laid off are generally finding new jobs. But the mood here is different thanks to Oct. 19.
``It sobered a lot of people,'' says Wesley Poriotis, head of Wesley, Brown, and Bartle, a New York recruiting firm. ``I have never seen the level of quality talent that is writing me cold.''
``A surprising number have found other positions,'' adds Fortunat Mueller-Maerki, a partner of Egon Zehnder, a large recruiting firm. But ``over the last few months I have seen the beginning of a group I would call the hard-core unemployed professionals.''
These are midlevel professionals who were thrown out of work by jittery managers. One, a $100,000-a-year midlevel professional in corporate finance, decided to buy a McDonald's franchise. Another considered opening a country inn, Mr. Mueller-Maerki says.
While still officially unemployed, Mr. Reede at least has the promise of a new job. His former employer, a large Wall Street investment firm, has rehired him for a temporary assignment overseas. On May 23, he starts his new job as project manager of the Urban Development Corporation, a quasi-public development entity for the State of New York.
``I think it's a healthy realignment,'' he says of the changes in the city's financial district. ``It's hard to grow if you are not challenged.''
For Anchie Quo, the challenge of Oct. 19 came just four months after he started working at a new brokerage firm here.
Concerned about the market's volatility, Mr. Quo started looking for a job. In January, he became business planning analyst for Pfizer Inc., a health-care company in New York.
The new off-Wall Street jobs often aren't as prestigious or well paying. Quo says his new salary will bring in about 80 percent of his Wall Street earnings during the boom period. But in the current chastened mood, ``I know for a fact that they [friends on Wall Street] won't be making as much as I am.''
The bulk of the layoffs occurred among back-office clerks and secretaries who were no longer needed when business got slow. Brokerage houses in other parts of the country have also made cuts, but New York has been a focus of the reductions.
The actual reports of Wall Street cutbacks are misleading, several executive recruiters say. One widely quoted estimate states that Wall Street has laid off 15,000 workers since the stocks plummeted in October. In fact, many firms that made sweeping cuts were also aggressively hiring at the same time, Mr. Poriotis says. ``If they had to get rid of 15, they got rid of 40. Then they hired [another] 20. The real story here is ... the behind-the-scenes hiring.''
Last week, a new study from the regional commissioner of the US Bureau of Labor Statistics reported that Wall Street had cut only 7,000 jobs since the big drop. But meanwhile, 10,000 more jobs have been created in the city's private sector during this time.
``Oct. 19 did mark the end of the 1980s as far as New York City is concerned,'' the regional commissioner, Samuel Ehrenhalt, was quoted as saying, ``but only because it ushered in a new era of intense competition.''
Overall, the sense seems to be that the worst is over for Wall Street cutbacks. ``I think we're going to have a cooling off period - maybe out to 1990, 1991,'' says Perrin Long, an analyst of brokerage firms at Lipper Analytical Securities Corporation. ``In some firms, people will be let go, but not in large numbers.''
In fact, the biggest impact of the stock market's plunge may be on top officials in a wide variety of small companies that were planning to expand, Poriotis says. But the plunge prompted investors to pull back funds and many chief operating and chief financial officers are deciding to work elsewhere.