It's been a brutal time for executives in structured finance departments across Wall Street since the 2008 financial crisis.

Despite a brief resurgence last year, the doldrums have set in again, although sales traders with broad relationships and versatile bankers are still finding new, if smaller, homes.

Most of the big global banks over the past few months have announced cutting thousands of personnel, especially from their investment banking and capital markets areas.

No one expects structured finance to be spared, and indeed units dealing with moribund asset classes - including private-label RMBS, student loans and more recently CMBS - are likely to see steeper cuts.

Heidrick & Struggles partner John Lee said some Wall Street firms have already started laying off mortgage salespeople, including Goldman Sachs, which laid off sales executives in Chicago and New York a few weeks ago.

Goldman typically lays off their bottom performers annually, but the layoffs this year fall in line with the industry-wide trend following weak second-quarter earnings. Goldman declined to comment.

In addition, noted Lee, the Dodd-Frank Act's Volcker Rule has prompted large firms, including JPMorgan Chase, Goldman, Citigroup, Bank of America Merrill Lynch and Morgan Stanley, to eliminate or sell their proprietary trading arms.

Lee added that Chicago's Citadel is exiting the broker-dealer securities business. "They have quite a few salespeople and traders that will hit the market soon if Citadel can't find a home for the entire team," Lee said.

As the federal government and the Federal Reserve injected capital into the system following the near-collapse of the financial system in 2008, hiring began to pick up in late 2009 and lasted through third-quarter 2010.

Some firms such as UBS and Deutsche Bank sought to bulk up their ABS and MBS departments during that period.

A structured finance recruiter said that most of the ABS and MBS executives hired recently have expertise in very specific areas, such as auto and equipment leases, or esoteric assets. "You're not going to hear about people getting hired with expertise in student loans or credit cards," he said.

The recruiter added that mostly sales traders and traders are finding positions today, while bankers' and originators' longer-term skills at building relationships and markets are in far less demand, largely because volume has plummeted across most asset classes. In private-label RMBS, for example, only two small Jumbo deals have been completed in more than two years from REIT Redwood Trust.

Ron D'Vari, CEO of NewOak Capital Advisors, noted that one major impediment has been Dodd-Frank's 5% retention rule, since it has yet to be defined and has created uncertainty around how much capital firms will have to hold against transactions.

Lee said that while Basel III's more intensive capital requirements don't have to be implemented fully until 2019, many banks are looking to get a head start, and that's prompting them to review business segments' profits and whether they warrant the required capital.

The non-agency CMO and CMBS businesses, for example, are relatively capital intensive and have seen their liquidity fall over the last few years. More recently, they've been hammered by dislocation in the credit markets and price volatility.

"It makes the banks think again about the scale, or whether they want to set aside any portion of their balance sheets, for those types of businesses," Lee said.

Lee said that there's some demand for sales experience on the mortgage side, as long as those sales executives bring relationships that fill gaps at the hiring firm.

"Smaller and midsize firms are looking to fill in holes on the sales side, and they're looking for traders covering the agency market," Lee said, adding that firms can now hire talent on the cheap if those executives have been laid off and their deferred compensation is made fully vested by their former employers.

D'Vari said NewOak has made several hires over the past four months, including a senior professional with commercial real estate expertise. "We just added a co-head of underwriting and structuring with 10 years' experience," he said.

He added that his firm hires upward of one in 20 applicants, mostly because executives have specialized in niches over the last 10 years. NewOak, as a smaller firm, requires hired employees to have a broad base of knowledge, especially since the firm is building its advisory practice to help clients adapt to today's rapidly changing markets.

"Our most recent hire was a gentleman who had recently worked in deep-dive credit workouts in Europe and has very broad knowledge acrossmunicipal finance and structured products as well as infrastructure," D'Vari said

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