With the recent volatility in the equity markets caused (supposedly) by inflation fears, you should ask yourself what all this means for your job search. Although equities returned 20- 30% last year, December and January have already shown uneasiness. Read below to see how you can minimize stock market volatility.

The 10-year government bond yield is up 0.20% or 20 bps year to date. Goldman Sachs now expects 4 interest rate increases in 2022 vs. 3 a short while ago. Just read anything coming out of the Fed, and it’s pretty clear we’re heading up.

I recently spoke at a webinar sponsored by BlueSteps, a career service of the Association of Executive Search & Leadership Consultants (AESC). My first comment, “you should develop at least a preliminary view on the US economy, interest rates, inflation, etc. for your job search” seemed to surprise listeners.

You can’t know what the market will bring, however, you can be strategic in your thinking. How? Let’s explore 3 ideas.

Don’t move since layoffs happen LIFO 

Why would someone who makes his living helping professionals move to achieve their career goals ever say, “don’t move?” It’s not like you have a black widow spider on your arm.

Sometimes the best advice is to do nothing. If you were recently promoted, received a big raise, or have been at your job fewer than 2 years, staying put might be the best alternative for you to minimize stock market volatility.

If you are risk-averse or learning new skills you might want to stay. After all, LIFO (last in first out) means newer professionals get the ax first since they generally don’t have political capital built.

Favor later stage startups 

I have written an article germane to this topic to help you determine your next home if you want to jump into a less hierarchical structure where you can make a real difference. Now, instead of a Series A/B round, push your search to a Series B/C.

In addition, make sure they have funding for a 2-year runway in case the capital markets are not friendly. Ensure their management has been through at least 2, if not 3 economic cycles.

Investigate their products and ask around if they really have a sustainable, provable competitive advantage. Do they have a large company customer base or rely upon smaller ones?

If you listen to investment bankers who have made public and private comments, they expect the public and private capital markets to be less forgiving. Public multiples have already started contracting, and it’s just a matter of time before risk premiums return. This is how you can minimize stock market volatility.

Tilt more towards a cash base 

You would not believe the base salary range that companies in the same sector are offering. This wide range also applies to an expected cash bonus. Depending upon your financial goals, you can give up some upside for a higher base.

Do not assume that a promised cash bonus in 2022 will happen in a choppy market. Bonuses depend upon so many factors outside of your control.

Would you take a $250k base with an expected 35% cash upside or $300k base with an expected 15% upside? The point is you have choices if you know how to research the market and negotiate effectively.

Bottom line- Don’t panic 

Even if you don’t believe we are going through a reversion to the mean for stock returns, M&A activity, etc. you should still do some homework to get smart about your options.

 

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