As many as one in 15 hedge fund employees could be out of a job by the end of the year, one executive search firm has estimated.
Options Group says that hedge funds have already cut between 3,000 and 5,000 jobs this year, numbers which could double by the end of the year. Hedge funds employ an estimated 150,000 people worldwide. Those losses are a drop in the bucket compared to the bloodbath on Wall Street—the world’s biggest banks and securities firms have slashed 131,766 jobs in the second half of 2008 alone—but it’s a big deal for the hedge fund industry.
“It’s bad out there,” Michael Karp, CEO of New York-based Options Group, told Bloomberg News. “Generating returns is not easy at the moment and as funds look to cut costs, the best way is to let go of people.”
The corollary to such widespread job cuts is, of course, that finding new work is not easy. Karp said his firm is getting almost twice as many hedge fund resumes per day as it did last year, but despite a handful of hiring sprees on the part of a few big names, he said that there are not many jobs to be had.
“While there are interviews going on all the time, there are not many offers,” he told Bloomberg.