NEW YORK ( TheStreet) - It may come as a surprise to those watching Wall Street
bonuses pile up and seeing headlines about a hiring spree, but Wall Street is actually losing jobs. adds to executive ranks to boost performance in certain divisions, people tend to notice too. Similarly, when Wells Fargo ( WFC) says it plans to hire 10,000 employees, or Goldman Sachs ( GS) announces that it has expanded its headcount by 3% over a short period of time, it can seem like a hiring spree is afoot. But big banks are certainly not seeking out fresh blood across the board. Firms are eager to manage clients' money, structure deals for corporate customers and make nice with regulators as new financial regulation is implemented. They're not so eager to structure exotic derivative deals or plunge further into once-popular areas that deal with consumer finance. Furthermore, Wall Street has yet to prove that it's hiring enough workers in key divisions to make up for those it's getting rid of in divisions whose outlook is bleak. For instance, Wells Fargo's goal of 10,000 new hires pertains just to its capital markets division, which isn't as large or as strong as it could be. The hiring will occur over an indefinite amount of time. Meanwhile, Wells is axing its consumer-finance business, leading to 3,800 layoffs by year-end.
Goldman has a targeted hiring scheme as well. The bank is scouting out top-notch asset managers with a strong book of business, as well as risk managers and regulatory experts. CFO David Viniar added that the bank's hiring practices aren't much helping the employment picture at home: "It's more outside the U.S. than in the U.S.," he said. Last year there was a lot of buzz about banks bolstering mortgage-servicing divisions because of the wave of refinancing requests. Yet many of the people they hired to man the phone lines, broker deals and underwrite loans weren't necessarily permanent, full-time employees. Now that the mortgage tide has ebbed, it's unlikely that all of them will be asked to stick around. On a net basis, BLS data indicate that banks did very minimal hiring -- if any -- in mortgage production last year. And though the Treasury pushed banks to improve performance for troubled homeowners, customers still complain of paperwork errors, processing delays and that employees don't seem well-trained. Bank of America CEO Brian Moynihan laid out the hiring picture pretty plainly last week. He was asked about attempts to strengthen the BofA-Merrill investment-banking division, which is struggling to close the gap with JPMorgan Chase ( JPM) for the No. 1 spot in league tables. "It's replacing people we lost and adding people, but it's against a total base of 10,000 to 15,000 people," said Moynihan, adding that, on a net basis, "it's
an in the hundreds-type of thing." Data from the New York Comptroller's office show that employment in the securities industry has picked up again from a low point last winter, but is nowhere near the heady days of subprime in 2007 and 2008. The investment banking and wealth management divisions of Goldman, Morgan Stanley ( MS), BofA-Merrill and JPMorgan have added thousands to their ranks, as have foreign competitors like Deutsche Bank, Credit Suisse ( CS), Barclays ( BCS), Nomura and Macquarie. That doesn't include the hirings since then, those that will come, or those at boutique investment firms and other shops that operate on The Street. Yet to look at the comings on Wall Street in isolation without examining the goings makes little sense. Since the term "Wall Street" is more conceptual than geographic, it's also difficult to pin down exactly how many jobs have been gained or lost. Wall Street exists in Chicago, San Francisco, Houston, London and Shanghai, and can pertain to anything from stocks and bonds to insurance contracts to corn futures. "A lot of people are being hired," said Moynihan. But, he later added, "relative to the whole size of the business it will be an impact, but not a huge impact." -- Written by Lauren Tara LaCapra in New York.