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Financial meltdown to hit headhunters

By A.Ananthalakshmi – Analysis

BANGALORE (Reuters) – U.S.-based executive recruiters, already facing the heat of a global economic slowdown, could be a big casualty of the shakeup in the financial industry as battered Wall Street firms slow down on top-level hiring.

Korn/Ferry International Inc and Heidrick & Struggles International Inc — the only publicly traded executive search firms in the United States — could see profits erode further over the next few quarters as corporate America goes slow on white collar jobs.

The financial services sector accounted for about 19 percent of Korn/Ferry’s and 27 percent of Heidrick’s overall revenue in the latest reported quarter.

“We believe the slowdown in financial services will continue to affect the profit and loss statement of executive search companies in the third quarter,” Suntrust Robinson Humphrey analyst Tobey Sommer wrote in a note.

The financial sector has already shed 103,000 workers so far this year, according to Challenger, Gray & Christmas, a global outplacement consultancy that tracks daily job-cut announcements.

Recent financial industry events such as the bankruptcy of Lehman Brothers and Bank of America’s purchase of Merrill Lynch  could send job cuts in the sector this year past the 2007 record total of 153,105, John Challenger, chief executive of the consultancy, said in a statement this month.

Jobs Roundup

Selected links from the financial industry’s roller-coast week, which left thousands out of work and even more worried about their future.

Wall Street Journal: B-Schools Move to Assist Alums The day after Lehman Brothers Holdings Inc. said it would file for bankruptcy protection, University of Chicago’s Graduate School of Business career office had already made personal calls to all of their 26 alumni from the 2008 class who worked at the firm.

Workforce.com: Wall Street Woes Have Recruiters Scrambling as Firms Try to Poach Talent “It is historic and it is a feeding frenzy,” said Darin Manis, CEO of financial services recruiter RJ & Makay in Colorado Springs, Colorado.

U.S. News & World Report: Where Wall Street’s Unemployed Can Turn Generally, when you lose your job, you can rely on friends to help you through. But what if all your friends lost their jobs, too?

Crain’s New York Business: NYC unemployment rate surges to nearly 6% The city’s unemployment rate increased nearly one percentage point last month, indicating that Wall Street’s woes are starting to take their toll on the local economy. At 5.8%, New York City’s seasonally adjusted unemployment rate is still below the national average of 6.1%, but that gap is steadily closing.

MSNBC: Job hunting on Wall Street? The line forms here Employees at Lehman Bros. and Merrill Lynch better spruce up their resumes fast if they want to move to the head of an ever-growing line of out-of-work Wall Streeters.