Should I Be Worried About My Banking Job?
Tamany L., Oakville, Ontario
Boy is your timing spot on. Just this past week the U.S. experienced one of its most stressful times in the financial services sector since the Great Depression. Two more major investment banks - Lehman Brothers and Merril Lynch - either went bankrupt or got swallowed up by another bank. And, the American government had to bail out the two largest mortgage providers in the country, Fannie Mae and Freddie Mac, so now the government is on the hook for literally trillions of dollars if things get a lot worse there. Even one of that country's largest insurance firms, AIG, was forced to restructure on the weekend.
So does this mean that The Royal Bank, CIBC, Bank of Montreal, ScotiaBank and TD will be collapsing anytime soon, thereby throwing thousands into the unemployment lines (as is happening on Wall Street in New York)? Doubtful, our financial institutions have been much more cautious in lending out mortgage money than their U.S. counterparts. The grim joke is that American banks gave out billions in so-called ''NINJA loans'' to applicants with No Income, No Job, No Assets. That in big part is what has caused the great housing collapse over there.
Still, some institutions in Canada have been hurt more than others by recent goings on. While every major bank here has seen its share price fall on average about 15% or so since a year ago, CIBC is the worst hit (-33%) yet National Bank actually has increased (+3%). Thus not all players are being equally affected. Which suggests that you might want to keep track of your employer's stock price trends and news that unexpected layoffs are taking place?
To answer your question about whether you should be looking for work outside the banking sector, my suggestion would be not to jump ship rashly. If anything, you may want to investigate working for one of the more stable banks. Should you decide to shift jobs ahead of the curve, your chances of getting hired elsewhere increase, since you won't be swamped by as many competitors. But you have to ask yourself if it's worth giving up the tenure you've acquired with your current company to go somewhere else right now. Also, moving to a different sector entirely may not be necessary if the U.S. gets its house in order and their financial fallout doesn't cause a panic in Canada. You may just be able to ride out the storm - unless it whips into a hurricane like Ike and begins to cause a general meltdown. In which case we'll all be burnishing our resumes and feasting on Kraft Dinner more often, a scenario that the world's governments will do everything they can to avoid!
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