It’s crystal ball time again, and it seems a particularly difficult time to predict City Finance jobs – both sell & buy side. There’s UK/European uncertainty given a looming EU referendum in the UK, there’s international uncertainty due to all the unrest in the Middle East, and both of the world’s largest economies have serious challenges: China’s economy appears to be slowing down, and it’s financial markets are having adolescent wobbles, while the USA is trying to wheen itself off QE amid a less than stella recovery.
Let’s have some context here first – there are relatively few City Finance jobs compared with other professional sectors, yet there is a huge demand for the client-facing, front office positions, so even in good years there are far more job seekers settling for Plan B than achieving Plan A.
The legacy of the 2007 crash is still with us – the aftermath of the crisis has meant that the only areas we’ve seen jobs growth have been in the departments that are addressing new regulatory requirements – namely Risk, Compliance, IT & Operations. Some believe that the growth of these non-income generating departments has now ended and that financial organisations will now start looking to address the spiralling costs this growth has lead to – so maybe these will no longer be the entry routes for budding City Pros.
Investment Banking had an excellent year in 2015, if that continues this year then banks may start to feel confident enough to increase their staffing levels in 2017, but the last 2 good years (2002 & 2007) saw huge falls the next year, so it’s too early to say that we are on a trend for jobs growth here.
The sales and trading divisions look to be split, with FICC on a continuing downward trend, and any growth, or even stability,in jobs coming from Equities. There is some indication that one of the traditional entry level roles – Research Analyst – is the latest area being off-shored to India in readiness for the Basel III requirement to sell rather than give away research.
The Buy-Side seems to be more stable, with neither an expected increase or decrease in opportunities. There’s some indication that more firms are becoming active investors in smaller, private organisations, but it’s too early to say that this will lead to more opportunities in due-diligence/research.
The key employment trend for the last few years has been the growth of third-party providers – research, IT, risk, compliance, administration. The uncertainties and cost worries I’ve mentioned above would seem to indicate that this trend will be continuing for some time – so it’s probably a good idea to look at firms providing these services for opportunities rather than their big-brand customers.
I haven’t got a crystal ball of course – and all these thoughts and suppositions have been cobbled together from reading the FT.com, efinancialcareers.co.uk, and listening to Radio 4 – so don’t just take may word for any of this, it’s over to you to do your own research & analysis.