Press Release: August's annual data reveals 18% increase in City vacancies

Hakan Enver 08.09.2014

City recruitment feels impact of summer slowdown but hiring levels move in right direction year-on-year

Monitoring the pulse of the City Jobs Market since 2004

Job availability in the City up 18%

Active jobseekers in the City up 27%

London Employment Monitor August 2014 highlights:

•    Year-on-year figures show an 18% increase in City job opportunities
•    Candidate numbers up 27% annually
•    Knock-on effects of holiday season see vacancies fall 14% and candidates dip 7% compared to July 2014
•    Salaries increased by 17% on average for those securing new jobs in August 2014**

City recruitment feels impact of summer slowdown but hiring levels move in right direction year-on-year

Figures from the August 2014 London Employment Monitor indicate that City hiring managers are feeling the impact of the traditional summer slowdown, however, year-on-year, recruitment levels continue to fare well.  Job opportunities totalled 7,995 in August 2014, down 14% from the July figure of 9,315.  At the same time, candidate numbers registered a 7% fall, from 7,953 in July to 7,404 in August.  Despite this, annual data reveals that the City jobs market is moving in the right direction, with vacancies up 18% and candidates up 27% on August 2013 figures.

Hakan Enver, Operations Director, Morgan McKinley Financial Services, commented:

“August proved a challenging month for City recruitment, with the market definitely feeling the impact of the summer holiday season.   The permanent hiring space was particularly slow, with many of the key decision makers away on annual leave, which stalled interview processes.  However, this blip was entirely expected and not reflective of the general upward trend in hiring, shown in the annual 18% rise in vacancies.  We predict the market will bounce back in September, and this view is certainly underpinned by the various macroeconomic data that has recently been reported, including the UK’s improved ranking in the World Economic Forum’s list of best performing economies and the Office of National Statistics’ (ONS) upwards revision of the country’s economic recovery.

“Despite August’s downturn in vacancies, there were pockets in the financial services sector where hiring remained busy.  As in July, there continued to be strong demand within the Accounting and Finance sphere, particularly for regulatory roles, while the Risk function continued to show a healthy appetite to recruit.  The key areas of hiring within Risk concentrated on model validation and anything with a strong risk methodology focus. This is a result of continued pressure enforced by the regulators to re-calibrate existing models and implement more stringent stress testing frameworks. We have also seen demand for credit risk analysts increase, particularly those with Emerging Market language skills. This has been led by transactions in the various Emerging Markets Group countries and the political sanctions imposed on certain territories, namely Russia.  Banks are having to review the amount of capital and “risk leverage” imposed on each client, therefore, forcing ongoing credit reviews on new and existing counterparties. 

“Elsewhere, 2014 has been an exciting and unpredictable year for operations vacancies, particularly in light of the continuing focus on Dodd Frank, EMIR and regulatory compliance. Demand for experienced and junior operations candidates with strong regulatory knowledge has pushed up salaries and rates on offer in many back office functions, most noticeably regulatory reporting and client services.  Currently, the busiest area within investment banking operations remains within the Loans space.  Demand for candidates with strong exposure to syndicated and bilateral loan products who can interpret, understand and review loan documentation and loan agreements continues to grow.  Those with strong LoanIQ experience and a forward thinking attitude will always have a competitive advantage.  Meanwhile, hiring managers are increasingly pushing to gain permanent headcount in order to solidify their strategic plans for the remainder of this year.

“In terms of candidates, following the massive 40% month-on-month uplift in active job seekers we saw in July, which bucked the trend as far as the summer months are concerned, August data shows the number dropped by a marginal 7%.  However, it still remains significantly higher than in May and June, which as we suggested last month, could be attributed to people enjoying ‘staycations’, which provide an ideal opportunity for individuals to reflect on their career and investigate other options.  One factor that could well impinge on candidate numbers as we head into autumn is the Scottish referendum, which could result in an influx of Scottish professionals into the City’s jobs market, should major banks like RBS and Lloyds decide to register their head offices in London.

“Although recruitment within the City is exceptionally positive – and we predict a boost to hiring throughout September and for the remainder of 2014 - this could possibly be hampered by the continued onus on regulation which is negatively impacting upon firms’ cost bases, both in terms of staff and IT infrastructure.  This has become yet more pertinent given the news that the incoming EU Commission president Jean-Claude Juncker is proposing a new EU financial services ‘tsar’.  If the revenue generators within institutions cannot keep apace, long-term we may see clients clawing back hiring budgets.” 

Salaries up by 17% with regulatory knowledge rewarded for operations professionals

The average salary increase for those securing new jobs in August 2014 was 17%, compared to 20% in July 2014.

Enver continued:

“Despite a small drop compared to the previous month’s average salary increase, the 17% rise in pay for those securing new roles last month remains significant and is indicative of the onus on City institutions to ensure remuneration packages on offer attract employees with the key skill sets they need to succeed in a challenging market.  

“Looking specifically at banking operations, junior and experienced analysts with the specialist knowledge needed to help firms reshape their business models to comply with regulatory demands are at a premium.   With retention in this area an issue for many City employers, these individuals are being rewarded accordingly, as the Emolument data for operations professionals highlights (Chart 4).  Meanwhile, despite the introduction of banking bonus caps, it appears the bonus culture is still very much prevalent in the City – according to Emolument figures, analysts in banking operations can expect on average a 6% bonus, far higher than the 2.6% average for the UK workforce, while the most senior level employees can command around 68%.”

Chart 1: Financial services jobs new to the market August 2014

Chart 2: Job seekers available, both in and out of employment August 2014

Chart 3: Average change in salary each month August 2014

Average Salaries and Average Bonuses for Operations Professionals within Investment Banking in Financial Services, London - August 2014

Further press information:

Vicki McDonald, BlueSky PR                                
Tel: +44 (0)1582 790708                                     
Email: pr@morganmckinley.com    

Notes to editors:

Statistical methodology

Monthly new jobs and new candidates

*From May 2013, the London Employment Monitor now uses Morgan McKinley’s own weekly records of new permanent and temporary job vacancies and new candidates registering with the firm for employment. Statistics for the full market are derived using Morgan McKinley’s market share.

Salaries

** Chart (3) illustrates the average percentage change between original salary and new salary offer for professionals securing new roles each month.


About Morgan McKinley

Morgan McKinley is a global professional services recruiter connecting specialist talent with leading employers across multiple industries and disciplines. 

With offices across Ireland, the UK, EMEA, Asia and Australia, the company’s professional recruitment expertise spans banking & financial services; commerce & industry and professional services. Morgan McKinley is a preferred supplier to many of the major employers in its specialist sectors and thousands of smaller local firms.
 
In 2013 Morgan McKinley was ranked 39th out of 100 in Recruiter magazine’s Hot 100, which ranks recruitment companies in the UK.

In 2013, Morgan McKinley was recognised in the Irish Independent’s listing of Best SME Workplaces in Ireland. We are also proud to be ranked in Deloitte’s Top 20 Best Managed Companies in Ireland for 2013.

www.morganmckinley.co.uk

Hakan Enver's picture
Managing Director
henver@morganmckinley.co.uk