In the world of investment banking, the landscape can be incredibly dynamic and unpredictable. Economic downturns, such as recessions or market contractions, often lead to restructuring, downsizing, and reductions in force (RIF) across the industry. Unfortunately, investment banking candidates who have been impacted by a RIF can face unique challenges when seeking new opportunities in a down market. In this blog, we will explore some of the obstacles these individuals may encounter and provide advice on how to approach their job search with resilience and adaptability.
1. Expect the hiring process to be more rigorous in a down market
Firms will be cautious about adding new team members, and as a result, they may conduct more rounds of interviews and thorough reference checks. Be prepared to answer questions about your previous role, the reasons for the RIF, and how you have grown from the experience. Honesty and transparency are vital during this stage, as employers appreciate candidates who can learn from setbacks.
2. Confirmation of Performance from Previous Employers
With a competitive job market, companies may conduct “back channeling” to confirm a candidate’s performance from their previous employer. This underscores the importance of maintaining good relationships with former colleagues and supervisors, even if the RIF was an unfortunate outcome. Always strive to leave a positive impression, as your references can significantly influence your chances of securing a new position.
3. Potentially Moving to a Lower Tier or Brand Level Bank
As you seek new opportunities, it’s essential to be realistic about the possibility of starting at a lower tier or brand level bank. In a down market, candidates might have to accept positions that are slightly below their previous roles. Remember that this can be a stepping stone, and with dedication and perseverance, you can work your way back up to your desired level.
4. Taking a Step Back to Retrack and Prove Yourself
Consider viewing this period as an opportunity to retrack and gain experience in different areas of investment banking. Sometimes, taking a step back can lead to significant personal and professional growth. Show enthusiasm for learning and take on new responsibilities to demonstrate your value to potential employers.
5. Prorated Bonuses and Challenges for Visa Holders
In a down market, firms may offer prorated bonuses based on the time you spent with the company. Be prepared for this possibility and understand that it is a reflection of the challenging economic conditions. Additionally, visa holders might face increased challenges in securing employment after a RIF due to visa restrictions and employer sponsorship requirements. Expanding your job search to global opportunities and networking within relevant communities may enhance your chances of finding a suitable position.
6. Pivoting to Private Equity and the Buy Side
Transitioning to private equity or the buy side can be more challenging during a down market. These sectors often seek experienced candidates, and competition can be fierce. However, with the right networking and a well-defined value proposition, you can increase your chances of success. Highlight your transferable skills and how they align with the specific needs of these industries.
Advice: Be Realistic, Flexible, Positive, and Cast a Wide Net
Be Realistic: Understand that the job market during a down market can be tough, and finding the ideal role might take time. Be patient and pragmatic in your approach, considering different opportunities that align with your long-term goals.
Be Flexible: Stay open to exploring roles in different sectors or financial institutions. Flexibility can lead to unexpected opportunities and growth potential.
Stay Positive: A positive attitude can make a significant difference during a job search. Stay motivated, maintain a strong work ethic, and be resilient in the face of challenges.
Cast a Wide Net: Diversify your job search efforts by applying to multiple positions and leveraging your network. Consider working with recruiters who specialize in the financial services industry.
Conclusion
Facing a RIF during a down market can be a daunting experience for investment banking candidates. However, it is essential to remember that setbacks are temporary, and the financial industry is known for its cyclical nature. By staying realistic, flexible, positive, and casting a wide net in their job search, impacted candidates can increase their chances of securing new opportunities that align with their career goals. With persistence and adaptability, they can navigate the challenges of a down market and emerge stronger on the other side.
