Firing and the City

Cost cutting is never far from people’s thoughts even in the hazy days of August.  It seems some of those working in London’s asset management industry have redundancies on their minds this summer, with the gloomiest view coming from fund managers owned by banks.

Nearly two thirds expect more job cuts to loom on the horizon this year, according to  a survey of over 200 asset managers by Such a pessimistic outlook is not surprising given that many banks have been mulling whether to sell off their asset management arms to focus on their core business, while others have put up the “for sale” sign only to take it down again because the price is not right.

But there is a ray of hope too. Fund managers working in multi-strategy boutiques are the most bullish with the majority of them confident their headcount would remain unchanged.

Perhaps they are drawing confidence from another piece of research that Penrose Financial carried out this week where the investment industry expects multi-strategy asset management businesses that offer alternative and traditional investments to emerge as the winning model in the financial crisis.

Those in the multi-strategy part of the business were also more upbeat on future hiring prospects.

Views on hiring and firing activity in the coming six months may be mixed depending which part of the industry individuals come from. But the sense of relief of those who have survived the first six months of the year is shared and must be palpable.

About the blog

FTfm is no longer updated but it remains open as an archive.

FTfm's specialist writing team offer their insights into the global fund management industry.

About the authors

Pauline Skypala has been editor of FTfm for four years having previously been deputy personal finance editor. She joined the FT in 1999 and has been writing on savings and investment issues throughout her career.

Steve Johnson, FTfm deputy editor, has been a journalist for 17 years, 10 of which have been with the FT.

Sophia Grene, reporter on FTfm, has been a financial journalist in print and online for 12 years.

Ruth Sullivan has worked as a financial/business journalist and foreign correspondent and for the past 10 years has been at the FT.