A year ago this month, Nick, a 31-year-old West Villager from Pennsylvania with short dark brown hair, was laid off from his job as a private-equity salesman at what he called a “mid-tier” bank. As bonus season approached, his prospects did not seem bright. But his spirits, curiously, were. “Being a bachelor who rents in New York, I didn’t have a lot of commitments or responsibilities,” he said. And when a friend who was building a polo club in West Palm Beach, Fla., invited him to come help out for a few months, Nick thought, What the hell, sublet his apartment and hopped on a direct flight south.
“When you’re in Florida, you’re outside all the time,” he said. “We were in the heart of sugar cane country, in a totally undeveloped area. I rode every day.”
It was a vast improvement over the trading desk, he added, where “you’re working very early hours, you’re always inside, you’re always on the telephone, you’re never around green space.”
In the wake of continuing, even worsening, layoffs in the financial industry (10,000 in New York since last August, Bloomberg recently reported, with behemoths like Citigroup cutting 10 percent of its investment bank alone); as double-digit drops in net worth have top executives wringing their hands in The Times, much of Wall Street’s young are simply throwing up theirs and saying, “Whoo-hoo!”
Tommy Kim, 27, formerly of UBS, for example, logged 37 days of snowboarding in 2008 after being fired last January. “When I got laid off, it was like, hallelujah,” he said.
After the snow melted, he came back to New York, where “I went paint-balling,” Mr. Kim said. “I went to Six Flags.” Now: “I stay up late, wake up late, go to the beach a lot. I play a lot of video games when I can’t find people to hang out with. I started reading again for pleasure, which is something I haven’t done since before college.” (Currently on the nightstand: Freakonomics).
He doesn’t have a three-bedroom in Westchester or a country club membership. He’s single and owns a one-bedroom in Queens that he bought “really cheap” in 2004.
Recently, Mr. Kim turned his attention to organizing his vast music collection and playing DJ gigs around town, including a Saturday party at the Brooklyn Museum and a few weddings (he was a well-known DJ during his undergrad days at Dartmouth). He’s also taking break-dancing classes. And he built himself a new computer, just for the hell of it. Looked up the instructions online, bought the parts, et voilà!
And his job search? “I’m kind of looking,” Mr. Kim said. “I decided last week maybe I should be more proactive.” It’s hard to get worked up, though, because “President Bush extended unemployment by another 13 weeks!” That’s $405 a week on top of the “generous” UBS severance.
‘I AM IN PERU!’
Despite the prevailing devil-may-care attitude among New York’s youngest financiers, most of the bankers interviewed for this story did not want their names used, fearing it might hurt their chances of future employment. One tall, dashing 26-year-old former hedge fund associate and Ivy Leaguer laid off in June furtively e-mailed his travel itinerary to The Observer: July in Europe, traveling through Spain, Berlin, Amsterdam and London. “Then I came down to Peru for two weeks to see Cusco, Lima and Machu Picchu,” he wrote. “I just decided that I wanted to see a ton of places that I had never had the chance to visit before. I did feel like I needed to take advantage of being young and without child, mortgage, wife or job, but with enough money that I did not have to worry about my next job right away.”
He would have liked to answer more questions, but “I do not have that much access to e-mail and, well, I am in Peru!”
Jeffrey, 23, had just been promoted to associate at a top investment bank when he volunteered to be laid off in May. “We weren’t doing anything,” he said of his workload. “I decided I’d had enough of New York. I went on a little bit of a bender for three weeks. Then I shipped my stuff home, moved back in with my parents in Albuquerque.”
Originally, young Jeffrey had planned to spend the entire month of July in Costa Rica, but that fell through when he couldn’t find a traveling companion. Instead, he took long trips to L.A. and back to New York again to see Billy Joel’s last concert at Shea Stadium, and is currently packing for a 10-day trip to Israel.
“I’ve been here catching up with old high-school friends, spending a lot of time on the golf course,” Jeff said. “I never really played much golf, but I’m taking lessons. I also grew a mustache, which literally took a month. I don’t grow much facial hair. I didn’t know when in my life I’d have a month to devote to that.
“A lot of my friends are very jealous of the lifestyle I’ve been living lately,” he remarked.
Of course, there are plenty of young analysts and associates still toiling for New York’s faltering banks, some bored to tears by the lack of work. What do they think of their fallen—or is it liberated?—coworkers?
“He’s just looking for a job,” snapped a handsome, dark-suited Brit of a fired friend; he was drinking draft beer at Ulysses, a bar behind Goldman Sachs’ Wall Street headquarters, after work on a recent Friday. “There’s no Dostoyevsky stuff; he’s just looking for another job.”
At an outside picnic table, a tall, deeply tan and boisterous 20-something said he was pretty sure another ex-colleague had bought a lot of cocaine. “He has a drug problem,” he said darkly.
“I know a girl from Bear Stearns … she’s going to fashion school right now. She’s taking classes in fashion,” said a 23-year-old whippersnapper with styled blond hair who felt pretty secure in his own perch. “I’ll put it this way: The book I manage is worth about a trillion dollars.”
“It just depends on the age that you were laid off at,” said a pretty 23-year-old in a chic “business-casual” cardigan and black pants, one of only several women in the place. “If you’re older and you have your family, you’re more likely to try to get a job quickly and faster. And if younger, you could possibly consider changing career paths.”
And what would she herself do if the ax fell? “I guess I’d probably go back to school,” she said.
Other people’s contingency plans were more elaborate. “I would start my own business,” fantasized a 25-year-old Indian guy wearing a blue dress shirt, a table over. “I would start a small restaurant, something like that. A sushi restaurant. That’s what I am going to do anyway, hopefully.”
SPENDING CREDIT SUISSE’S MONEY
The thing about being tossed out the window as a young banker is that you tend to land on a soft cushion, at least temporarily.
“For the few months after getting laid off, you’re also able to collect unemployment, so I was actually making more money for the first couple months after being laid off than I would have been at work!” said Jeffrey, the former associate from Albuquerque. He spent much of his severance paying off the debt he’d accumulated in his first months in New York, when he thought his job would be more, well, lucrative. “I built up a lot of debt being young,” he said. “I got hired at the peak of the market [in fall 2006], and I kind of just spent, assuming I was going to get a bonus at a certain level, and then the market crashed and I got a bonus at a tenth of that level. I was doing the whole New York summer shares in the Hamptons, going out …” He’s now planning to move to L.A.
Most deposed young bankers reported receiving two or three months’ severance from their former employers, and some even said they also received a pro-rated version of the yearly bonus they would have received come January (one 23-year old estimated his total haul at $50,000). Often severance is paid as a lump sum, meaning it’s “salary taxed as bonus,” as one banker pointed out. In other words, not enough to fund an early retirement, but certainly adequate for an extended convalescence in Amsterdam, or at least surf camp in Santa Monica. After all, most unattached twentysomethings have only themselves to consider (and mom and dad may still be considering them, too). And besides, it’s still summer!
Some fortunate financiers actually lined up new work immediately, enabling them to draw two salaries for the summer. “A lot of us are fine,” said a former Bear Stearns analyst, 23, who was laid off in June, and who’s still on salary from the company until the end of August, along with walking away with two-thirds of last year’s bonus. His new job, at a rival firm, has more responsibility, less grunt work and a higher paycheck.
Also back at work is a shaggy-haired former basketball player named Dave, 23, who found himself assigned right out of training in summer 2007 to the CMBS (commercial mortgage backed securities) group at Credit Suisse, which was at that time “already the worst place to be,” he said by phone the other day. “Two weeks after I started, they laid off a third of the group, which was 150 people. It was pretty morbid.”
When the third round of layoffs came in April, Dave found himself relieved to be on the list.
“I walked out of there smiling,” he said. “There was a bunch of us. We all went to a bar right around the corner and got really drunk.”
After that? “I went to Vegas for a week and I lost about half my severance,” Dave said. “It was a terrible decision. My dad was working out there and I wasn’t doing anything, so I crashed with him; during the days I helped him out—he’s a jeweler—and then at nights I was going crazy, spending Credit Suisse’s money as fast as I could.”
Then there was a lot of lying on the couch and watching TV,. “It got really depressing and boring after a while,” he admitted. “I tried to convince myself to go to Australia and become, like, a professional surfer or something ridiculous like that,” he said. “But I don’t have the balls for that. I’d love to go to New Zealand and be a farmer, sheep herder, and live off the land. But it’s not going to happen.”
Nick, the polo player, is also back in New York looking for a job. “Maybe it’d be nice to go to a smaller city like Chicago,” he said. “I hope to be employed in the fall.”