Infrastructure market update – July 2013

With more pressure than ever for strong regulatory and control frameworks, the main theme in infrastructure functions in the first half of 2013 has been companies’ search for the elusive technical skills needed. Any firm that is slightly ahead becomes the target for aggressive poaching and in some areas wages are spiralling.
  • Finance sell side – heavy demand in regulatory in COREP in both British and US banks (new EU requirement for financial institutions) and in funding and liquidity. Demand curtailed in PC and IPV mostly because many of these functions are being offshored or leavers are not being replaced. Strong demand for SQL/VBA analysis in retail banks to model the success of retail banking products to focus on profitability.
  • Finance buy side – demand for fund accountants has increased. Complexity and number of funds has led to higher demand from a governance perspective. Demand is for broad based analysts rather than pure accountants as there is now a greater need for interpretation of results and analytics. Steady demand from both PE and institutional fund managers. Fund services demand continues to increase as small firms outsource these functions further and regulatory and liquidity requirements become more cumbersome.
  • Audit – pressure from the regulator and from risk functions and firm management is increasing the workload and complexity of the internal audit function and we anticipate significant hiring in H2 2013 and in 2014. Banks seek people with the skills and technical experience to hit the ground running so competitor firms are targeted and wage inflation follows. Internal auditors are being offered strong incentives to move, some firms are lagging 30-50% behind the market.
  • Compliance – the splitting of the regulator, the increase in European interference and new legislation have kept a spotlight on compliance but hiring in the larger banks has not been excessive so far in 2013. Tweaks to structures, replacement hiring and certain specialist and niche roles have been the focus, though the quality bar is set high and hiring processes have been protracted. Pressure on costs has curbed some recruitment and many compliance teams are working longer hours and being stretched to provide coverage. Buy side firms, boutiques and small and mid-tier organisations are bucking this trend. Many smaller firms are hiring good quality generalist compliance officers but there is a shortage of suitable candidates in this market. Generally firms are unwilling to hire unless they find the elusive perfect candidate to fill the role. There is an assumption that the market is awash with suitable and available people for these jobs but the truth is different with many candidates too specialised.
  • In risk, hiring continues to be fluid, with a number of tier one banks developing their portfolio risk teams. To satisfy regulators and the board, firms need the ability to better consolidate information. As such they have either restructured or are currently hiring into these teams. While risk departments continue to be more resilient to redundancy than the front office, a few of the leading banks have announced cuts, mainly to reflect front cuts and discontinued product areas.
  • Treasury – hiring continues to ramp up particularly within group treasury functions as opposed to individual business units. This is predominantly due to regulatory pressure. Since 2010, demand has been consistent across roles such as asset and liability management/balance sheet management, liquidity analysis and reporting. The sheer weight of regulation, coupled with a company’s need to deepen their understanding of all risks on their banking and trading books should ensure a healthy flow of positions through the rest of 2013.
  • Operations recruitment has been stronger in H1 2013 than at any time in 2012. There have been more senior level hires from AVP upwards. Some hiring has been in response to new OTC clearing initiatives and regulation. Also there has been an increased focus on counterparty risk and collateral management within these organisations. Another area has been new payment regulation (SEPA) and UK banks in particular have been hiring back office expertise to help re-engineer payment processes and controls.
  • Marketing, communications and events functions have seen high demand for digital marketing candidates, with poor supply. High demand for marketing candidates with research and analytical skills. It remains a candidate driven market in these areas. Fewer vacancies are available for senior candidates.
  • Human Resources functions have seen a significant amount of restructuring to ensure effective utilisation of current resources with a strong drive towards a more value based business support culture. There is demand for good talent (retention), learning and development (design and delivery), change management and employee engagement individuals and in these areas the market remains candidate driven.
  • Legal – hiring has picked up due to increased workload and stretched resource. This hiring and replacement of leavers is being done with more junior candidates, particularly in 2-5 years’ post-qualified range, and this may be symptomatic of general cost pressure. It has created a shortage of such individuals in the market.
To speak to someone about your banking and financial services recruitment process, get in touch with Simon Lindrea.
T: 020 7776 5959