London Financial Services Salary Survey 2012

The last 12 months have been mixed for global financial markets and consequently for financial services hiring activity. The eurozone crisis has created an extremely challenging operating environment for many financial institutions in Europe and beyond. Subsequently, the hiring market has been significantly affected and the pattern of recruitment activity throughout 2011 has reflected this.

As a result, remuneration has fluctuated across the sector with some pockets of the market enjoying salary increases, whilst others have remained relatively flat. Lack of visibility in the market has led to some areas seeing increases in temporary and contract recruitment instead of hiring permanent professionals. Rates have increased in certain areas as a result. Our recent survey of 372 hiring managers and professionals working across financial services in London provides some interesting insight into views on compensation levels.

The results of the survey also reflect current market conditions. Survey highlights show that only 12% of those in the permanent market are feeling more confident about job availability compared to this time last year.

On a more positive note, just over a third (35%) are optimistic that salaries will rise over the course of 2012 while 50% expect salaries to stay at their current levels.

In the temporary hiring market, 11% felt more confident with respect to job availability than this time last year, with 52% feeling equally as confident. Over 60% anticipate that rates will either remain the same or will rise over the next 12 months. In both the permanent and temporary recruitment markets, the main driver for increasing salaries is expected to be attracting and retaining key staff –clearly a significant focus for financial institutions.

It looks likely that headcount will continue to be closely scrutinised in the early part of 2012. This is illustrated again in both the permanent and temporary areas of the hiring market where survey respondents acknowledged their companies’ continued drive for cost reduction.

The mixed findings of our survey clearly reflect the lack of visibility and turbulence in the hiring market as the new year begins. It is well known that financial markets thrive on stability. Therefore a conclusion to the eurozone crisis and clarity on regulatory issues such as the Vickers report should bring greater transparency and confidence to the banking system in the UK.

Finally, we hope you find this salary survey informative and welcome your feedback. I would also like to take this opportunity to thank you for your continued support and wish you all the best for 2012.