Still, bear market reaches home

Darren Adamchak’s Wall Street career appeared to be accelerating even as the stock market swooned.

Then, all of a sudden, it all turned bad.

Four months after getting a remarkable bump up to a vice president’s position at Deutsche Asset Management Inc., Adamchak was let go in a round of layoffs.

"I was promoted within a year, which is astronomical," the 30-year-old European portfolio analyst said. "I was doing a great job."

Now, he has joined the growing ranks of traders for whom pink slips have replaced lavish lunch receipts as the common tender. More than 32,000 securities workers have lost their jobs since the end of 2000.

While the market has rallied in the past week, the prolonged bear market has severely cut into the number of financial deals big and small -- and the profits they produce.

A new austerity is apparent on Wall Street: Gone are the days of investment bankers buying rounds of martinis after work, let alone brand new BMWs. The weekend jaunts to Aspen, Colo., are over.

The average U.S. investor, with a shriveled portfolio, may have little sympathy. But it’s more than just the perks that are gone for those who work in the market.

Many young analysts and traders are left pondering whether to change careers, sell their homes or put off starting families. Some older colleagues see retirement delayed -- and their expected income reduced.

Getting a new job once was easy on Wall Street. Now, even veteran headhunters say it’s the worst job market they’ve seen, even worse than after the 1987 stock market crash.

"What is more dismal is that, in the last few days, people’s view of 2003 has gotten worse as well," said Alan Johnson, managing director for the New York-based compensation firm Johnson Associates Inc.

For those lucky enough to still be on a payroll, their offices and trading desks have become tense places where workers fear being let go any day.

In the past two weeks, a number of firms -- including Fidelity Investments Inc., Credit Suisse First Boston Inc., Bank of America Inc. and Goldman Sachs & Co. -- have announced new rounds of job cuts.

Deutsche Asset Management is a division of Deutsche Bank AG, the large German bank that bought the Baltimore-based Alex. Brown brokerage.

Alex. Brown's operations since have been dismantled, though it maintains a large brokerage operation in Baltimore.

In addition, firms’ year-end bonus checks, which can account for as much as half or more of a top executive’s yearly earnings, will be thin this year -- if they are issued at all.

"Employees are realizing the bonus is something that might not exist this year," said Jim Zamparelli, managing director of Snelling Inc., a financial-services recruiting firm. "Bonus means exactly what it say. I hate to say that.

"Unfortunately, we have been spoiled, including myself, for a number of years," he said.

Zamparelli said his office had been "inundated with resumes, with calls from people who haven’t found work in six months."

The falloff in business has been stunning: The industry saw just seven initial public offerings completed from July through September, the fewest in a quarter since April-to-June of 1978, when companies issued six, according to Thomson First Call Inc.

Proceeds from IPOs have fallen 32 percent, to $18.4 billion so far this year.

That’s just a fraction of the dot-com IPO craze of the late '90s bull market, when 65 IPOs per quarter was not uncommon.

In the third quarter, global underwriting declined 12.6 percent, to $774 billion, from a year ago. Underwriting fees fell harder, down 21 percent, to $2.3 billion.

The industry still is making profits, estimated at $1.1 billion, for securities firms in the third quarter. That’s cut in half from last year, according to the Securities Industry Association, but better than the market’s last two major downturns -- 1987 and 1991 -- when the industry posted losses.

If Wall Street starts to lose money, things could get even worse -- and prospects already are bad.

"For sure, there are more cuts to be made," said Barry Honig, president of Honig International Inc., a New Jersey-based executive search firm that specializes in the financial industry. "Many of the firms are going to do another round of 5 to 10 percent."

Adamchak, the analyst laid off in August from Deutsche Asset Management, is considering a change in careers, possibly working at his mother’s marble and granite company or at his father’s construction business.

"I was living very well," Adamchak said. "I just recently bought a house in Old Bethpage [N.Y., on Long Island] and recently got married and was going to start a family.

"My plans have been shot down," he continued. "I am re-analyzing what to do in the future."

Heather McDaniel Willis was just getting started in the business, hired by Citigroup Inc. after being an intern during the summer of 2001.

She was let go in November.

After going through training, "They gave us a [severance] package and said, ‘Thanks, but no thanks,’” Willis said.

Willis was a teacher before going to Columbia University for her MBA degree. "All that work," she said with a sigh, referring to her graduate studies.

She has returned to education, working for a nonprofit that tries to put minorities in management.

But others aren’t ready to turn their backs on Wall Street and its potential for big income.

"Compensation is a lot higher in that industry," said Jim Rossiter, who lost his job as comptroller at Daiwa Securities Inc. in August.

Rossiter, 31, has contacted as many as 30 Wall Street recruiters. He doesn’t expect to get a job until next year, and anticipates that he’ll have to take a 10 percent pay cut, as demand for work continues to outstrip supply.

Rossiter rattled off his reduced expectations with surprising calm, but then again getting laid off didn’t come as a surprise.

"I anticipated it for several months," he said.