Subject: Hey, do you have a minute? Either come to my office or we can meet in a conference room.Uh oh.
Unless that email is coming from the co-worker you’ve been secretly dating or (one of) the secretaries you’re having an affair with, you’re probably going to be fired in the next 5-10 minutes if you see this subject line in your inbox.
Early Warning Signs Of The Layoff
The first stage of the layoff is a rumour about a certain number of people being fired. Sometimes it’s in the thousands; sometimes it’s in the hundreds if it’s just in one department.
Unfortunately, rumours are usually true in the finance industry. Or at the very least have some basis in truth.
So when you start hearing rumblings that people are getting fired, it’s safe to assume that they are.
Other early warning signs of impending layoffs include:
- Emails from very high-up execs in the firm reminding everyone to be frugal.
- Closing dinners for deals getting canceled or scaled back due to “market conditions” or “cost-saving measures.”
- Maximum dinner expenses dropping from $30 or $35 to $25… or $20… or even (gasp) $15.
Who Will Be Affected
This one depends on the state of the economy, and which groups have been in a “bubble” over the past few years.
Debt Capital Markets (DCM), by contrast, tends to remain more stable because companies always need debt for day-to-day funding.
But it’s very dependent on the market: in the late 80s and early 90s after the junk bond market imploded, everyone there was laid off; in the aftermath of the mid-2000s bubble, lots of people in mortgages / CDOs / Fixed Income were laid off.
No group is “safe” from layoffs, but Restructuring can be counter-cyclical – however, there are few Restructuring groups on Wall Street, so don’t count on being rescued by going there.
Preparing For The Battle
If you know layoffs are coming and you’re not sure whether or not you’re on “the list,” there are a few things you can do to prepare beforehand.
- Remove everything important from your cubicle, but be subtle about it.
- Start contacting headhunters and other friends at other firms so you can explore “strategic alternatives.”
- Form a close-knit group of co-workers you can trust and discuss everything everyone hears each day.
You might think the first point is stupid, but you’d be surprised at the sheer quantity of stuff people have in their cubicles. I’ve seen tax returns, expensive cameras and digital equipment, even wedding rings stowed away in the hidden depths of peoples’ cubicles before.
If you get fired you’ll probably have to leave the building immediately, without much time to gather all your belongings. So make sure you get everything beforehand.
The only catch here is that you have be subtle about removing all your stuff. Don’t completely empty out your cube; just make sure the important stuff is safe and keep decoy items on your desk to avoid attracting attention.
Points 2 and 3 are self-explanatory; it’s critical to have that support network in place at all times anyway, but it’s especially the case when layoffs start.
The Moment Of Impact
You’ll either get an email like the one above:
Subject: Hey, do you have a minute? Either come to my office or we can meet in a conference room.
Or you’ll be summoned to this mysterious conference room via a phone call or someone directly approaching you.
In investment banking people love to waste time on making font sizes consistent and formatting PowerPoint, but they hate to waste time on firing people. So it will be quick, and you’ll be informed of the decision upfront.
At this point, you need to keep your calm and pay attention to the only number that matters: your severance (if you get any…).
After that, you’ll either be escorted out of the building immediately or you might get a few minutes or few hours to remove some of your personal belongings.
Occasionally when people leave voluntarily, they might be allowed to stick around for a few days to a week so they can “transition” projects. But I’ve never seen people stick around that long when it’s involuntary.
One exception to this: sometimes laid-off senior bankers stick around longer because they do indeed need time to transition clients and projects to other senior bankers.
So, what happens when you’re laid off and shown the door?
Well, to start with, you suddenly have an additional 80-100 hours of free time each week (if you’re an Analyst).
But all you can do is decide what to do next – whether that’s moving to another firm, switching industries, or just taking a break.
Regardless of what you decide, I would strongly recommend taking a week off and removing yourself from the grind for a while. Go to Thailand; go to Hawaii; go wherever you want and unwind for a while.
Just think: as long as you didn’t spend too much on models and bottles, you could do this for months.