Party Down, or Just Down Parties?
As business slows, outlook for holiday gatherings is also less encouraging
By Jessica Papini December 3, 2007
Holiday parties are being scaled back across Wall Street, and many professionals are feeling a little less merry and more Grinch-like when it comes to celebrating this year. Business has generally been down, there have been massive layoffs impacting colleagues throughout the industry and bonuses are expected to be essentially flat.
Eighty-five percent of companies will hold a holiday party this year, a 9% decrease over last year, according to a survey conducted by Battalia Winston, an executive search firm. Battalia interviewed 104 companies, and 20% were financial firms.
This year represents the third-lowest percentage of companies holding parties in the 19 years the survey has been done. After Sept. 11 and during the recession of 1991, firms cancelled their holiday parties. "Throughout the years, we've learned that the percentage of company parties is directly linked to the health of the economy," says Dale Winston, CEO of Battalia.
Wall Street firms are holding back to some degree due to bad earnings and layoffs at almost every major bank, with additional ones expected to come, experts say. Some companies are choosing not to host a holiday party, less for cost-cutting reasons than not wanting to throw a celebration when business is down and people are losing their jobs, says Jo Bennett, partner at Battalia. She adds, however, that the reason companies have holiday parties in the first place is to make employees feel appreciated and build morale.
Seventy-nine percent of companies surveyed say their holiday celebrations will be unchanged by the current credit crisis, but 19% did state the credit problems have impacted their plans.
Event planner Claudia Glenn Barasch, president of Claudia Glenn Events, says, "Companies are not freely spending money as they have in the past, but they are still providing single malt scotches and cigars." Also, some have discreetly cut back on the premium open bars, and have a set menu, instead of letting employees order off the full menu, says Glenn, who works with hedge funds and investment banking firms.
Suzen O'Rourke, president of Cooking by the Book, whose clients include financial firms, is also seeing some companies cut back on spending. O'Rourke's events, which have co-workers cook dinner together, cost around $200 per person.
"Firms are spending modestly, they want employees to have a nice time, but they don't want them to feel as if they went over the top and wasted money," says Bryan Jacobson, president of Corporate Events Manhattan. He estimates a typical party of 400 guests, including alcohol and food, would come with a bill of $85,000.
Often, clients will say that they had a good year, but don't think it's wise to spend on a holiday party, especially because people get upset if they didn't receive the bonus they were expecting, Jacobson says.
Who's partying?
Mum's generally the word on Wall Street holiday parties. However, with most parties starting this week or next week, some were tough to conceal.
Despite layoffs at Citigroup, and the anticipation that more will come, parties are still being held by the banking giant. The operations department is having a party at Latin Quarter restaurant. Thursday, French bank BNP Paribas has a company wide party at catering facility Bridgewaters. About 1,600 people attend, and the evening includes drinks, hors d'oeuvres and dinner. The party was in the same place last year, and the events team booked the space in the first quarter of this year. However, the company only pays for one party, and any individual parties that division teams wish to have are not on BNP's dollar, or even the more favorable euro.
Lehman Brothers usually announces bonuses to employees and then buses them to Chelsea Piers Pier Sixty, where people can either drown their sorrows or celebrate. There is food, dancing and drinks, sans hard alcohol. Each division goes on separate nights, and the parties start next Monday.
Goldman Sachs has individual office parties at different locations. The investment management division technology group, which consists of about 350 people, is holding its party at BLVD club in Manhattan Dec. 13. Goldman employees usually find out about their bonuses after the holiday parties are over.
Manhattan Pavilion is hosting PricewaterhouseCoopers' party this month, but no other financial firms have booked the space. In the past, Deutsche Bank has held its holiday party there. Deutsche Bank does not have company-wide parties, but each division manager usually plans a party at a restaurant or bar with their immediate colleagues, a Deutsche Bank employee said.
jessica.papini@sourcemedia.com
(c) 2007 Investment Dealers' Digest Magazine and SourceMedia, Inc. All Rights Reserved.
