Lehman and Merrill to pound already bloody job market
The likely disappearance of investment banks Lehman Brothers and Merrill Lynch presents a double-barreled hit to an already wounded job market, and will likely depress salaries on Wall Street.
With Lehman headed for bankruptcy and Merrill swallowed by Bank of America, two of Wall Street’s four pillars have crumbled overnight.
Headhunters and consultants said the U.S. financial services sector, already suffering from a glut of unemployed talent after shedding more than 100,000 jobs this year, must now brace for up to 50,000 more.
“The resume flow will start on Monday like there’s no tomorrow,” said Michael Karp, chief executive at executive search and consulting firm Options Group in New York.
“This is seriously going to impact compensation this year, across the Street and all over the world as well,” he said.
“The golden years of compensation in the financial services industry are over, and it doesn’t help with the Bear Stearns people still looking for work.”
On Sunday, eleventh-hour talks to sell Lehman failed, making bankruptcy a certainty instant payday advance.
At the same time, Bank of America, the second-largest U.S. bank, was wrapping up a surprise acquisition of Merrill, the world’s largest brokerage, in a deal that would save Merrill from Lehman’s fate.