If you're trying to find a new job in financial services, or think that you will soon be trying to find a new job in financial services, you can probably do without Meredith Whitney's imprecation that another 50,000 financial services job cuts are on their way and that bankers need to take whatever they can get.
Nevertheless, it helps to have a Plan B. The only problem is - as the New York Times pointed out a few months ago - that Plan B jobs have also become harder to move into than was previously the case. In the post-war period, the NYT argued that 'strivers' were able to formulate big dreams because they, "had a solid Plan B."
Now, however, Plan B jobs are disappearing: It's less easy than it used to be to become a tax accountant, for example, now that online software packages exist.
This was the traditional Plan B route for people who have worked in the front office of an investment bank
Historically, investment bankers were forced into a Plan B career by default, say headhunters.
"The usual post-redundancy lifecycle for someone let go from a good house was that he left pumped full of hubris, thinking he was the best thing since sliced bread," says the head of one fixed income search boutique. "He trotted around a few houses and then realised that the hiring appetite was very diminished. At that point, he decided to take six months off and do what he'd always wanted - to travel the world. When that was over, he knocked on the door of a few headhunters he'd never have given the time of day to previously and ultimately decided to take on a 'new challenge' in a second or third tier house."
Why this isn't on offer any more
The problem in the current market, say recruiters, is that many second and third tier houses aren't hiring either.
Yes, there's Cantor, which is said to be building out a full service investment bank, but recruiters say it's very fussy about who it recruits, that Cantor's salaries can be low and that some investment bankers struggle with its culture.
Other potential hirers, like Jefferies, have high costs and are said to be making redundancies themselves. Russian banks like Renaissance Capital are making cuts too and VTB is focused on hiring in Asia. (Asia has also been a recent Plan B for many bankers losing their jobs in London or New York. However, banks are now cutting staff in Asia as well and breaking into the Asian market is a lot harder than it was - unless you work in risk or compliance.)
What is on offer now
If you can't come out of a top tier investment bank and move to the second or third tier or relocate to Asia, what can you do?
Recruiters and career counsellors say financial services professionals do still have options. Many are obvious, but worth reiterating.
1. The professions
"If you're an accountant, qualified HR professional or a lawyer and you've been working in an investment bank, your logical plan B is go to leverage those professional qualifications, possibly outside sector" says Julian Rye, director of professional services at Lee Hecht Harrison DBM, a 'career transition firm' which works with displaced bankers.
"The real challenge tends to be for the core front office banking professionals," Rye adds. "Many of them want to do more of the same in a similar place - but opportunities can be tight in this market...Some look at a complete change of career, or starting their own enterprises, or explore broader areas like going into teaching, though a lesser number actually make this particular change".
2. Hedge funds
Hedge funds have continued to hire in London this year. As we noted recently, Brevan Howard has been picking up people from banks. Bluecrest has purportedly been hiring ex-bank employees too.
"Hedge funds are still active hirers," says Ebrahim Zaheer at Kennedy Group. "There's still demand from them for good portfolio managers and IT and programming staff. Hedge funds are also especially interested in hiring asset gatherers who can help them raise funds."
However, another recruiter cautions that the hedge fund sector is also suffering and that hedge funds are no safe second bet: "Very few are taking on new people. Most of the best traders from banks have moved to hedge funds already."
Rye says a significant proportion of the redundant bankers he works with have set themselves up as consultants.
"Consulting seems quite robust in a number of areas such as IT" says Rye. "But you'll need to be able to market yourself, hit the ground running and immediately deliver when in role and to build and maintain a good network of people who might buy your skills on a contract basis. Sometimes banks will bring people from the trading floor into compliance and control contract roles."
However, John Tattersall, a non-executive director at UBS and former chairman of the financial services regulatory practice at PWC, says most people who move into regulatory consulting and risk consulting roles need relevant experience. "Front office bankers are more likely to succeed as consultants if they focus on advising on investment and financing strategies," he says.
4. Corporate M&A and strategy teams
It's long been possible for ex-M&A bankers, who may soon be in ample supply, to move into corporate M&A or strategy teams and to work for their clients.
Dan McCarthy, managing director of One Search, says this remains a possibility and that it's an increasingly popular option. "A lot of FTSE 100 companies now have entire teams of deal-focused bankers and strategy professionals focused on organic growth. If you're coming from an M&A team at a leading bank, they will definitely be interested in you.
"The key thing is your knowledge of the sector," McCarthy adds. "If you're coming from an oil and gas team in a bank, you'll need to move somewhere like BP. It's no good trying to get into a company like Tescos."
The other options
There are always other options. Rye points out that it's not unheard of for former salespeople and traders to move into treasury roles in corporates. The head of front office recruiting at one European bank says many of their unwanted people have gone into property development and real estate funds. Others are being housed in long only funds. Equity researchers have traditionally been reborn into PR or investor relations.
On the whole, Rye says that if you lose your financial services job now, you can probably count on being out of the market for 4-8 months. "It's completely doable to get another job within a few months, but you'll need to make a lot of effort to market yourself and have clarity about what your target organisation needs and consistently match your transferrable skills to their requirements," he suggests.