Expansion of Compliance Industry is Forecast
“Compliance Officer” is one of the fastest growing occupations, according to the Department of Labor. Its forecast calls for exponential growth in this field, with a projected growth of 31% projected between 2008 and 2018. Expected employment in the compliance field is expected to be 341,000 by 2018.
This projection is not specific to the hedge fund industry, although it does include growth expected to occur within the financial services industry. As it pertains to hedge funds, the growth will occur in the hiring of chief compliance officers, internal support staff, as well as outsource compliance providers.
While universally viewed as a “good thing” for the hedge fund industry, there is a concern associated with these statistics. Specifically, will those hired to fill these additional positions in or for hedge funds possess the very specific skills that are necessary to adequately fulfill the job responsibilities? For example, could a compliance officer at an investment bank easily transition into a compliance officer role at hedge fund? Does a lawyer coming out of a general financial services practice at a law firm possess the skills to be a hedge fund chief compliance officer? Can a lawyer who specializes in broker-dealers also effectively provide compliance consultant services to a hedge fund?
Hiring and out-sourcing decisions at hedge funds need to be carefully considered. Skill sets must be analyzed carefully in order for a fund to hire the appropriate employee or consultant.
The Department of Labor report can be viewed at http://www.bls.gov/opub/mlr/2009/11/art5full.pdf
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