Recruitment boost in financial sector
9000 expected to be hired in three months
FINANCE jobs are on the rise despite firms complaining the controversy over bonuses is harming recruitment. Quarterly data compiled by the Confederation of British Industry and Pricewaterhousecoopers revealed financial firms increased staff by about 5000 in the first quarter of 2012, defying predictions of a jobs cull. They are expected to hire another 9000 over the next three months. However, concerns were raised about retail banking, with negative coverage of bonuses.
THE financial services sector has unexpectedly started hiring again after seeing a rise in business although banks are complaining that controversy over bonuses is affecting their ability to recruit.
The quarterly financial services survey conducted by the Confederation of British Industry and accountant PricewaterhouseCoopers (PWC ) showed that while three months ago, financial firms had expected to continue job cutting, they actually added an estimated 5000 jobs in the first quarter of 2012 to a workforce of just over one million.
They are expected to recruit another 9000 workers in the coming three months on the back of rising confidence, business volumes and profits as the industry begins to shake off the worries about the eurozone crisis that predominated before Christmas.
Stephanie Bruce, head of financial services at PWC in Scotland, said: “This has been another strong quarter for the industry and we expect to see this translate into more investment, particularly in the banking sector where increased headcount a nd enhanced digital offerings are mooted.”
But she added: “Despite some evidence of growing stability in the eurozone and more positive global economic drivers, this position remains fragile and the environment is challenging.”
Firms in industries including banking and life insurance, both key parts of the Scottish financial services scene are adding staff, the survey found.
However, investment managers, who had been hiring in previous months, are cutting back as they go on a cost-cutting drive.
The hiring, albeit still at low levels, came as financial services firms recorded the first increase in optimism in a year.
Some 44% of the 95 firms that responded to the survey saw volumes rise in the quarter to March and 21% reported a fall. Most expect another rise in the coming quarter.
With income, particularly through fees and commissions, increasing ahead of costs, profit growth accelerated at a faster rate than the previous three quarters.
Profits have improved for 11 quarters in a row although the expectation among firms is that this growth will start to ease off.
Firms pointed to trouble hiring, both for senior staff and clerical roles, as a barrier to growth.
This is particularly notable in banking where firms are seeking to boost retail banking staff while trimming their under-pressure investment banking arms, according to Kevin Burrowes, UK financial services leader at PWC.
He said: “We are beginning to see there are worries and concerns about the quality of professional staff that can be attracted into banking and we believe that links to some of the considerable coverage of the sector from the point of view of remuneration and the point of view of the attractiveness to people of working in it given the headlines we have seen about bonuses.”
He suggested that in the media and political climate potential banking recruits might prefer alternative career routes.
“There are many attractive sectors that pay well compared to the financial services sector right now,” he added.
Mr Burrowes said that retail banking is doing particularly well. “What we are seeing as confidence returns is a desire to continue to expand business,” he said. “The fight for market share is very strong and organisations are saying ‘we have got to continue to invest in retail banking’.”