HIRING HEATWAVE TO COOL?

We start this Q1 Newsletter by addressing a key, timely question of whether the recent, uber-competitive “war for talent” is subsiding. If so, what will it mean for the hiring environment and compensation across the finance industry?

Our short answer is yes, we do see a cooling in the market. However, the cooling process is unfolding as urgency levels and hiring process lengths are normalizing, rather than hiring coming to a complete standstill. Just last week (3/7/2023) the Fed Chair reported, “Despite the slowdown in growth, the labor market remains extremely tight. The unemployment rate was 3.4 percent in January, its lowest level since 1969. Job gains remained very strong in January, while the supply of labor has continued to lag. As of the end of December, there were 1.9 job openings for each unemployed individual, close to the all-time peak recorded last March.”¹

The COVID-19 pandemic helped streamline the recruiting process with the advent of Zoom interviewing. Now that people are returning to the office, the challenges of in-person interview scheduling have re-emerged. Many candidates are finding it difficult to schedule in-person meetings and half-day case studies into their workday, dragging out interview processes. Since each seat now takes longer to fill, the overall hiring market has slowed as well.

The hiring market is not uniform, especially when factoring in strategies, levels, markets, comp bands, etc. There are a number of areas within recruiting that remain particularly strong, and we foresee these continuing to be competitive areas for talent throughout 2023. These are detailed below. But first, we look at the factors driving this slowdown.

As usual, we also highlight some prominent job switches in the fields of private equity, hedge funds, private credit, IR/marketing and HR functions within the Alternatives industry.

Happy to discuss any of this further with you, and we wish you well for 2023.

The Odyssey Team

¹ Semiannual Monetary Policy Report to the Congress by Jerome Powell for Federal Reserve, 3/7/23