The banking sector, enduring rounds of deep job cuts, faces the grim prospect of having nowhere to turn to for immediate employment in the industry, as nearly all branches of finance have pulled back on hiring.

Unlike 2009, when the industry was split between banks recovering and banks expanding, this time around, the economic climate has forced a broad retreat across the entire sector.

"There are plenty of resumes going around in the market right now, just not too many takers," said Joe Neitham, a recruiter at TRC Group in Singapore. Neitham said any hires are on a critical need or project basis, with nearly zero appetite for corporate suite level roles.

The cuts in Asia come at a time when more are banking on it for employment. The number of workers licensed by Hong Kong's securities regulator grew to 55,000 at the end of September from 42,000 in 2007, the latest government records show.

Banks such as Standard Chartered and Nomura <8604.T>, which held up during the 2008 crisis, were among the banks that opened their doors to the legions of bankers laid off during that cycle. HSBC continued to hire as well, adding 5,000 staff in 2010.

Barclays and Credit Suisse, plus smaller local banks and boutiques across Asia also went on a post-2008 hiring spree, seeing an opportunity to gain share on weakened larger rivals such as Goldman Sachs and Morgan Stanley , UBS and Citigroup .

These days, a bank employee looking around for options at various firms is seeing very little, if anything at all.

Chad Holm is a career investment banker who moved to Asia with Bank of America last year at a time when the bank, and much of the industry was growing across the region.

In the current downturn, that expansion is now absent, a factor that is partly behind why the 39-year-old Seattle native is starting his own business.

Nomura is said to be looking to shed about 700 staff. Credit Suisse has outlined 1,500 layoffs.

Recruiters said Jefferies' Asia build-out and generous pay offers seemed set to be reined in while the bank struggles with investors worried about its exposure to Europe.

The mid-sized investment bank denied it was putting any plans in Asia on hold. "The contention that we are reining in our expansion in Asia is totally unfounded," said Richard Khaleel, a spokesman for Jefferies.

Virtually every other foreign bank in Asia is cutting staff, as the news keeps getting worse.

Deal volumes have fallen in Asia, with IPO proceeds totaling about $67 billion up to October this year, barely half that of the $130 billion clocked up during the same period in 2010, according to Thomson Reuters data. While fixed income and commercial banking has seen success this year, most banking activity in Asia and elsewhere ground to a halt in the second half.

That has forced banks including Credit Suisse, Macquarie Group Ltd , and Bank of America into rounds of Asia layoffs.

COST PRESSURES

One of the factors holding back commercial banks from hiring, in addition to the poor market conditions, is looming cost-control pressures.

Some of the investment bankers who moved over to expanding commercial banks after the 2008 crisis did not do so cheaply. Those holding a rank of managing director at an investment bank could expect salaries upwards of more than $1 million.

Like other commercial banks, HSBC, with a huge presence across Asia, has stated repeatedly that costs need to be reined in.

StanChart has said that most of its expansion is done as it tries to keep costs under control. High staff and overhead costs at StanChart's investment banking operations, which fall under its wholesale banking division, have led to costs growing faster this year than income growth.

"It's quite hard to imagine the likes of StanChart hiring anymore this year," said Dominic Chan, an analyst with BNP Paribas. "While the bank as a whole is running well, it might be difficult to justify hiring much more."

One option some out-of-work bankers sought in Asia after 2008 was positions at investment banking and wealth management units of Chinese commercial banks such as ICBC <1398.HK> and China Construction Bank <0939.HK>, which are all trying to grow their fee and commission income.

However, a major issue weighing on these banks is their persistent inability to keep up with global compensation levels. ICBC's outgoing Chairman Jiang Jianqing made only $150,000 in 2010, barely 0.5 percent of JPMorgan CEO Jamie Dimon's $20 million paycheck.

"Compensation is an area that needs to be looked at if the Chinese banks want to attract top talent," said Raymond Yung, Financial Services Leader for China for PricewaterhouseCoopers. "Senior bankers there are getting paid disproportionately little, and that can be a big cause for unhappiness."

TIME TO LEAVE

Terence Khoo, who manages two Asian funds at hedge fund Sofaer Capital, sees tough times ahead for all of Hong Kong's financial industry, not just the banking sector.

"On the sell side there's going to be a lot of retrenchments for sure," Khoo said. "With the buy side, there's a separation between big vs. small."

Khoo, who first joined the hedge fund industry in 2000, says rising cost pressures and weak markets are weighing on the financial industry.

"The way the market is going, it's time to leave the hedge fund and do something else in life," he quipped.

(Additional reporting by Alex Frew McMillian; Editing by Muralikumar Anantharaman)

(This story was corrected to add sourcing to paragraph 12 and denial from Jefferies in paragraph 13)

Citigroup China China Construction Bank Investment