Financial Services

20-Aug-2008

Recruitment in the financial sector is becoming less flexible, as clients take longer to approve candidates and cut the number of new hires.

“Last year there was volume recruitment; this year every hire is an absolute necessity. The way the market is, the bottom line is a little less than expected,” Jalpa Chandarana, manager, investment management at financial recruiter Joslin Rowe, told Recruiter.

There is an upside, however. Chandarana said placing highly skilled candidates boosts fees, and redundancies have freed up candidates. “It was harder to find good people this time last year — there are people who have been made redundant from companies which have shut down,” she said.

Miki Dartnall, senior manager of the Thames Valley branch of financial and commercial recruiter FSS, said she has noticed a similar reduction in business: “Job flow has slowed down, dropping around 30% on the same time last year. We are still growing and adding consultants, but we aren’t moving forwards as much as we would expect.”

The Monster Employment Index, which analyses online job opportunities, reported an eight-point drop for financial placements compared with the same time last year, and a nine-point increase across all sectors.

Hugo Sellert, head of economic research at Monster Worldwide, told Recruiter: “The decreasing trend over the past three months suggests that banks and other financial service providers are cutting back on hiring in response to the credit crunch and slowing economy.”

The length of time it takes to make placements in the financial services sector has increased, as companies put stricter controls on new hires. Financial recruiter Joslin Rowe’s Financial Services Employment Index recorded a 1.3- week increase on the time it takes to place candidates in May, compared to the same time last year, from 10.9 to 12.2 weeks.

“The life-cycle from registration through to placement is longer due to the market at the moment,” Chandarana said, explaining that more new hires are having to be approved by senior management.

Roland Seddon, regional director, Hays Senior Finance, believed the extra caution from clients is hurting their ability to place the right candidates because of the number of offers finance staff are receiving from other firms.

Cost-cutting measures have led financial institutions to increase direct hiring. Richard Jaques, director of financial services jobs board Getafinancejob.com, said: “There has been an increase in direct employers contacting us. They are looking at the whole resourcing route; testing the water to see how it will work.”

Dartnall has noticed a similar trend: “A lot of larger clients are trying to recruit direct first — it causes a problem. The positions given to recruitment agencies are the ones which are harder to fill, and often candidates have already applied directly for the roles in which we want to place them.”

However, Seddon said the nature of financial recruitment meant agencies would always be an essential part of the process. “Agencies have more than just advertising at their disposal. There is the active database of candidates, a database of candidates who have looked and are looking for a job, networking of contacts, search and other methods that aren’t easy for a company to do themselves.”

Reed.co.uk’s Market Index, which tracks online advertising, recorded a massive drop in the number of positions in the financial services sector. In England, the job postings fell from 23,000 to 10,000 over the past year, but Scotland experienced an even more dramatic drop, from 12,000 to 500.

Salaries for newly qualified Associate Chartered Accountants (ACA) continue to rise in response to candidate shortages. Hays’ Senior Finance Salary Guide found starting salaries had risen from £43,000 to £48,000 in 2007 to between £45,000 and £50,000 in 2008.

Sourced from reed.co.uk’s Market Index

christopher.goodfellow@centaur.co.uk