Professionals have had to adapt to tough market conditions and in some instances have reduced their rates in order to secure Compliance jobs.
The beginning of 2019 has seen the continuous rise of the challenger bank carrying over from 2018. Where the country remains somewhat in the dark surrounding how Brexit is going to progress, larger banks have put the majority of their hiring in the UK on hold unless absolutely necessary; e.g. for backfill.
A number of firms have been hiring away from the UK, with the likes of Paris, Luxembourg, Poland and India on the list for either Brexit planning, cost saving or establishing talent hubs (for example, Surveillance hubs in India where the data science skill set is higher).
Whilst retention doesn’t strictly apply to temporary hiring, so far this year a number of organisations have extended staff and pushed for extra approvals in order to keep contractors on board. The main reason for this is to keep headcount consistent until firms have moved forward 100% with their Brexit plans. There has also been a trend of temporary positions becoming permanent as more firms ‘try before they buy’, ensuring they have the right person for the role but also to prove the need for the headcount - this is mostly seen in the growing international/challenger banks.
The rise of FTC has meant temporary workers can now expect similar benefits to permanent employees, including flexible working, the option to work remotely and guaranteed bonuses. Firms have been adjusting their models of diversity led hiring and training initiatives. A great example of this is Investment 2020; a scheme that enables individuals with limited or no exposure to Financial Services to start their careers in the investment management industry and gain the necessary skills and experience to progress.
2019 commenced with Monitoring and Surveillance as being an in demand area, not only in the UK but further afield in the locations mentioned earlier. A number of firms are deciding where, and how, to best utilise their Surveillance function, whether to have it as part of the front office or in the back office. This was discussed in great detail at the recent 1st Line of Defence Surveillance Summit and also written up by a survey conducted by Promontory. Junior - mid level AML/FCC analysts have found themselves in demand, with the desire to hire coming from international banks and FinTech firms. As ever, ICA diplomas and CISI qualifications brought extra value to professionals.
Candidates who have found themselves out of work have had to adapt to tough market conditions that has resulted in a drop of jobs available when compared to the same period of 2018. In certain instances, including in the product advisory space, professionals have had to be flexible with their rates, some seeing a reduction of between 10% and 30%. The increased near and off-shoring has also caused candidates to be more open to relocating if they want to find suitable opportunities. As a whole, this is mostly within operational functions such as KYC, on-boarding and remediation. This said, it isn’t only cost saving that’s driving this, but also the fact that professionals in other locations are more skilled in different areas; some of the larger banks are moving their Surveillance functions to India due to the fluctuation of data scientists in that market.
It is unavoidable and, unsurprisingly, it’s the major event influencing almost every industry; Brexit. A number of firms are trying to become Brexit ready by creating entire functions in places such as Paris and Dublin. A number of firms were hoping that just a postbox would suffice, but the regulator has made it clear that is not the case.
Looking forward, we anticipate MiFID III to be the next big regulatory legislation to impact the compliance market. It is unlikely to be the huge upheaval that we saw for MiFID II, but more just fine tuning the existing regime.