The Square Mile may have been braced for a downturn this year, but there are already fears that the clouds gathering over the City of London job market are even blacker than envisaged only two months ago.

Not since the bursting of the dotcom bubble eight years ago have investment bankers in the Square Mile and Canary Wharf faced such uncertainty about their future. With large financial institutions continuing to reveal fresh losses from exposure to the subprime mortgage crisis, few can be sure they will still have a job at the end of 2008.