When markets are strong, employees get huge bonuses and laundry service. When markets weaken, employees get hung out to dry. The pattern has given Wall Street firms an unenviable reputation for poor management. And right now revenue is parched. The economy is slowing, fees from equity underwriting are down 65 percent through late March compared with the same time period in 2000, and fees from completed mergers and acquisitions are off 36 percent.
Layoffs seem certain.
But this downturn has been different so far. Past layoffs drained talent and made recruits look askance at firms that showed little commitment to their workers in bad times. This time around, rather than resorting to execution en masse, Wall Street managers are trying to trim with a scalpel. This is nothing compared to the bloodbath of previous downturns. Firms just don t want to lose market share when business picks up again.