Private Equity Job Outlook is Better Than Investment Banking

September 10, 2012

Collectively, investment banks are paring jobs by the thousands. With that in mind, job seekers might want to give the private equity world a long hard look. Private equity firms hired at a brisk pace in 2011. In a study by auditing firm EisnerAmper, 37 percent of private equity firms expanded their payrolls in the first half of 2012.

Just as important for private equity job hunters is the fact the EisnerAmper study showed just 7 percent of private equity firms anticipate lowering their payrolls. The private equity business has come under siege due to Mitt Romney’s candidacy for the presidency. As Romney’s wealth and private equity career have become lightning rods for his critics, so has the private equity business in general.

Good News for Private Equity Professionals

The good news for those looking for investment careers is that the Romney campaign has not had an adverse impact on private equity’s hiring practices. There are other indicators that job hunters could find a warm reception in the private equity market. Deal flow is starting to pick up following the dark days of the financial crisis. In August alone, PE deals exceeded $5 billion.

Go Global

Those willing to entertain careers overseas will find private equity superior better option when compared to investment banking. While investment banks are paring payrolls everywhere from New York to London to Hong Kong, private equity firms are looking to expand overseas. Private equity firms that manage funds aimed at emerging markets raised $17.2 billion in the first half of this year and are on track to match the $38.5 billion raised in 2011.

Gloom and Doom Residue

The ability of investment firms to raise additional capital cannot be understated as it pertains to private equity hiring practices. Not all firms are seeing the same level of fundraising success. Some industry observers argue that hiring is still somewhat soft and that trend will not reverse until fundraising trends improve in significant fashion.

Something else for private equity job seekers to consider: Due to staff reductions and slack deal flow during the financial crisis, the applicant pool has surged in recent years. Those with some investment banking experience do have a leg up in terms of landing a junior private equity position. On the other hand, those looking for top-tier private equity positions will find tougher sledding until the industry at large returns in earnest to pre-crisis form.

Still, the bottom line is the near-term outlook for private equity job seekers is strong, especially when compared to their brethren in the investment banking sector.

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