Fixed income a hot area in slow jobs recovery

There's been a fair amount of musical chairs in fixed income, said Lisa Zonino, a consultant at search firm Egon Zehnder in New York.

Banks that did well are hiring because they expect more business, while banks that did not do so well are hiring because they want to catch up with competitors, Zonino said.

The super-liquid markets for bonds, interest rates and currencies have gained appeal for banks and their customers, who are still smarting from losses on complex debt securities and stocks that plummeted amid the financial crisis.

The game of musical chairs began in earnest last year when the New York Federal Reserve named RBC Capital Markets , Jefferies Group and Nomura Holdings' <8604.T> U.S. unit as primary dealers of U.S. Treasury securities. These companies have since splashed out on hiring traders and sales people to support this new business.

Nomura hired Charles Spero, previously at Barclays , and Jeffrey Michaels from Citigroup Inc to co-head its fixed income business in the Americas. The pair, who joined in October, said they plan to hire more people.

Jefferies also built out its fixed income business with hires in Europe and Asia. Futures and options broker MF Global , which does not have primary dealer status, has hired staff in anticipation of getting the Fed's green light.

Still, at the larger banks, it's hard to tell whether new positions in fixed income are being created or if the hiring is simply to replace employees poached by the new entrants.

Certainly, headcount levels across Wall Street are still lower than before the financial crisis, according to Richelle Konian, co-founder and Chief Executive of search firm Careers On The Move.

And there is a preference for hiring cheaper, more junior staff rather than splashing out on top managing directors, Konian said. People are being very cost-conscious right now with hires, she added.

The exception is for senior executives with proven client relationships, said Gary Goldstein, founder and president of recruiting firm Whitney Group.

There seems to be a fair amount of activity looking for senior coverage, he said.

(Reporting by Elinor Comlay. Editing by Robert MacMillan)