Citigroup will lay off 53,000 employees. JPMorgan Chase plans to cut one in 10 people from its investment banking staff. The drumbeats grow louder for an ailing financial services industry. Where will all these people find work?
Not on Wall Street.
They might try Main Street. Wall Street refugees will be able to put their deep experience to good use at finance jobs in the hot fields of health care, government and alternative energy. The bonus structure won't be as lucrative, but in many cases the hours won't be as punishing. (The cost of living also drops outside New York City.)
Did you work on the sell side of a bank? Start your job search in the industry you covered. Your knowledge of the business, the players and the emerging trends make you uniquely suited for in-house finance positions. Play up that angle when networking and in cover letters. Reach out to former clients to see if there are openings. Canvas companies throughout the industry.
The in-house job prospects--for example, at a company like Pepsi -- include financial analyst, business analyst, budget analyst or research analyst. Salaries hover around $115,000, according to data from TheLadders.com, a job site that posts positions that command salaries of $100,000 and up.
Higher-level jobs include vice president of strategic planning (the person who determines how the company should expand), vice president of finance planning and analysis (operations on a short-term basis) and vice president of corporate development (mergers and acquisitions). Average salary for those jobs: about $221,000, according to TheLadders.com.
Compare that with Wall Street salaries: Investment bankers make about $100,000 their first few years out of business school, along with a bonus that ranges from $200,000 to $250,000, according to Vault.com, which collects salary data. Salaries don't go up by that much, but bonuses do. Historically, once bankers at elite firms have about 10 years of experience they're at the vice president or managing director level and command bonuses of at least $1 million.
Compensation may be lower in other sectors, but security is higher. MBA students are already learning that lesson. Turnout at an information session for Kraft Foods Inc. at New York University's Stern School of Business has been light for the past 12 years with about 25 students attending each year; this year there were more than 60.
It's a nationwide trend. "Students are more likely to consider going in-house in a finance role this year as opposed to year's past," says Jana Kierstead, managing director of career services at Harvard Business School.
Refugees from investment banks should also consider the buy side. Institutional investors need money managers. So do companies like Vanguard and Fidelity.
Once you've tapped these sectors, consider ranging further afield into areas that are growing at a rapid clip like government, health care, tech and nonprofits. Here is a run down on these areas:
Government. With more than half of the 2.7 million federal employees retiring soon, there will be great demand for those who work in finance, budgets and accounting. Salaries in these areas start at about $67,000 to $75,000 and increase for those that have more experience. This site aggregates government jobs: http://federaljobs.net/
The Treasury Department just created the Office of Financial Stability to oversee the federal bailout funds. Who better to monitor how banks are using that money than former bank insiders? There aren't a slew of jobs there--a few dozen, at the most--but those interested in a position with that office should visit http://www.treas.gov/initiatives/eesa/
Health care. The provider side of health care includes hospitals, research centers, long-term health care facilities, providers of home health care workers and companies that provide expertise on disease management. (Alere is one example of this type of company.) They all need employees in the treasury office to manage investments and other accounts.
"These former Wall Streeters have a deep understanding of how the sell side works," says Richard Clarke, CEO of the trade group Healthcare Financial Management Association. "That's experience that is often lacking within health care."
The health care industry also needs financial analysts to examine merger and acquisition opportunities and analysts to manage employee pension plans. Base salaries for these positions range from $100,000 to $200,000 and usually come with bonuses too. "Those from investment banks will find salaries to be lower, but the good news is these organizations tend to be a little more stable then investor organizations," says Clarke.
Another plus, says Clarke: "It's a feel-good job. What they do has a direct impact on the health of the community."
Opportunities exist on the insurance side of health care too. Companies like Aetna, Humana, UnitedHealthcare, WellPoint and Anthem Blue Cross and Blue Shield all need investment portfolio managers, financial analysts for the company's operations and people to negotiate the cost of coverage with medical facilities.
Find job openings at the Healthcare Financial Management Association's job board http://www.hfma.org/jobs/ Another good job resource is http://healthcarejobs.org/
Tech. You won't need a degree in energy to find a finance job in alternative energy. Look for mid-size companies that deal in clean coal, wind energy, hybrid motors and nuclear power. "They're looking for people who are critical thinkers with good quantitative skills," says Vault.com CEO Erik Sorenson.
Another hot area, says Sorenson, is virtual and online infrastructure. He points to companies like Akamai in Cambridge, Mass., which provides companies with large server bandwidth for their networks. Opportunities within online infrastructure are in business development and finance.
"They've all learned what it's like to work for a mature company," says Sorenson. "Now look at a growing company, that's ahead of the bubble."
Nonprofits. Foundations and universities are another place to look. They need money managers to invest their endowments. The foundation side doesn't offer high salaries, but universities are another story. At Harvard, which has the country's largest endowment, its former manager made $2.3 million. Don't count on a paycheck like that, though. Typically managers at schools with large endowments make in the high six figures.
These jobs are tough to get. You might have a leg up though if you're an alum of the school.
When applying for jobs outside your industry, tailor your resume. Show what you've accomplished instead of simply listing your responsibilities. For instance, show how much you've increased revenue in a particular time period. If you've managed a staff of 20 show how much productivity has increased. It also helps to convince hiring managers of your dedication to their industry by joining the field's trade group or attending seminars.
"Some of the most productive CEOs that turned around companies came from other industries," says Dennis V. Damp, author of Health Care Job Explosion and The Book of Government Jobs. "Outside experience can really help an organization, since someone from the outside brings a different perspective to the plate."