Bankers run for cover

30 September 2008 – Asian and European stock markets tumbled in early trading today after the US House of Representatives failed to adopt a US$700 billion Wall Street bailout measure. Australian shares closed down 4.3 per cent, their lowest close in nearly three years. Financial services companies in particular are destined to experience the worst job and bonus conditions in nearly a decade.

The employment situation is being heralded as the worst since the internet stocks collapse in 2000. The doom merchants are predicting that we are in for a ‘Black October’ and that the situation is likely to get worse in the run up to Christmas. Oh goody.

What can we expect to see happen?
> senior executives will be ‘outplaced’
> performance bonuses from the leading investment banks will diminish, as they fail to reach targets
> performance bonuses will no longer be guaranteed
> more and more layoffs will be necessary, as witnessed by hundreds leaving financial services operations at ANZ, Austock, Wilson HTM and Tolhurst and investment banking operations at B&B, Merrill Lynch, UBS and Lehman Brothers who are all looking like shadows of their former selves
> the long awaited merger between Westpac and St George may result in closer scrutiny of duplications and costs and see more bankers forced onto the market
> trimming of traditional back office cost centres such as IT and human resources has extended to bankers and ‘deal makers’
> the first employees to be laid off will be the most expendable – those with perceived inadequacies, in the least essential positions, the misfits and low performers
> recruitment firms will have to try very hard to place these people in new positions
> pressure will be placed thoughout organisations to cut costs and hold off on new projects
> some companies will slash marketing budgets but some will get nervous and increase spending to protect market position
> employees will work harder to prove their worth and stay employed
> companies will stop recruiting new staff until the dust settles

How does all this affect employer branding? When the dust does finally settle and the machine cranks up again and job candidates smell fresh hope in the air, more so than in nearly a decade will a bulletproof employer brand be necessary to convince these people that yours is a strong, stable and worthwhile organisation with excellent job security.

More so than ever before will you need to reinforce to staff the fundamental employer qualities that have seen the company through these bad times and brought it through intact with renewed ambition to help employees and itself grow and flourish.  

Employer branding consultants have a lot to look forward to. But how long will they have to wait? That is the $700 billion question on many people’s minds.

Tony Heywood is a Fellow of the Design Institute of Australia, founder of Heywood Innovation in Sydney Australia and joint founder of BrandSynergy in Singapore.
tony@heywood.com.au
www.heywood.com.au
www.brandsynergy.com.sg