The economic downturn is impacting all of us in one way or another. From a recruiting standpoint, one sector that has been dramatically changed in many ways is the financial services practice area.

First, the urgent, recent needs to serve investing clients, as a priority, is overwhelming the players who provide guidance and advice. Putting together deals urgently to avoid calamity has been a drill we see described in financial newspapers, but has changed recruiters’ abilities to communicate with candidates and clients alike.

This is an industry-wide fire drill that is using up all the bandwidth of a professional’s normal day. Bankers and politicians are working through weekends and spending nights at their offices to handle client inquiries or urgent needs to restructure, or to put together deals to save large companies under emergency duress. Due to this change in pace, searches and calls to consultants fall to the bottom of priority lists.

For search consultants, this is making it difficult to communicate with clients and candidates in a timely manner. The clients of our clients, whether they be retail (individuals) or institutional (private and public companies, foundations, and other financial firms) are storming the phones of advisors, bankers, managers, etc. with their frantic calls.

For professionals in the lending side of the financial services profession, the news isn’t much better. They’re busy working out troubled loans from credit cards, to business loans and mortgages, and it’s taxing their time-management abilities as well. Re-negotiations, re-structuring, and renewals all compound for a busy banker’s schedule, with the statistics of delinquencies and defaults continuing to soar. Again, this makes the job of the search consultant that much more difficult.

Second, consolidation is creating rapid changes in the players. The number of potential clients for search firms serving the financial industry is materially shrinking.