Looking back the 2019 year, it is safe to say that the economy and hiring trends across the financial services sector went through a bit of a roller coaster. Kicking off 2019, we were faced with looming fears of an economic downturn that led to most top tier financial institutions putting the brakes on hiring across Q1 and Q2. As the economy rallied in the second half of the year, U.S. unemployment hit an all-time low of 3.5%, and month in and month out, the number of jobs added continues to move north of expectations. From asset managers to bulge bracket banks, most major financial institutions feel confident in adding headcount in 2020. We are excited to see what the new year brings and how major financial institutions will solve one of their biggest challenges: talent.
Diversity in the workplace
While diversity and inclusion (D&I) seems to be a widely used phrase nowadays, the impacts of having a varied work force with regards to age, gender, and ethnicity have a major influence on a company’s ability to attract better talent and, ultimately, their bottom line. Harvard Business Review quoted a statistic from a McKinsey report that, “Companies in the top-quartile for workforce diversity are 33% more likely to financially outperform their less diverse counterparts.” We have seen and expect to see more titles in businesses such as ‘Chief Diversity Officer’ and ‘Head of Inclusion’ going into 2020 as institutions try and pull out all the stops to become as attractive as possible to potential hires.
With over 60 million Gen Z candidates entering the job market in the next one to two years, most financial institutions are changing their tactics and overall business structure to make sure they are putting their best foot forward to acquire this new layer of talent. The common thread and mind set for these new grads is about finding a stable and clear path to career growth and progression. This generation wants to work in an environment where their opinions are heard, where they can rely on job security, and where they can harness innovative, best-in-class technologies. In 2020 and over the next decade, we expect more major banks to brand themselves closer to tech businesses with cutting-edge analytics and data platforms to try and appeal to Gen Z.
Technology and interview processes
The use of alternative methods to conduct interviews and provide a mix of both quantitative and qualitative testing will be a major factor in the screening processes across banks and hedge funds in the new year. We have already witnessed first round phone screens turn into video recorded Q&A sessions, and as jobs in the front office and quantitative functions become more complex, employers will seek new ways to stress test candidates. Psychometric testing and analysis, as well as exams like the ghSmart test, help businesses weed out the good from the great and will be much more common in interviews over the next few years. In an effort to decrease selection bias and secure the best talent, job matching is another recruitment strategy we expect to increase; candidates who apply to a company will be presented to a myriad of groups and hiring managers and, following interview feedback, they will then be matched to a job that makes the most sense for their skill set and interests.
Flexible working situations
With an increased technological presence in our everyday lives, employers are now finding more secure and efficient ways to enable flexible working situations for their employees. We fully expect more companies to have a larger remote working presence, whether that be a full-time work from home structure or a few days from home per month. While the world of finance has been rather sluggish to adapt this trend, more roles within consulting, technology, audit and accounting are some of the first to unlock the full potential of telecommuters. Over the course of the next decade most employers expect to have at least 1 day of remote capabilities a week for their employees and recognize that falling behind in adapting flexible trends will hinder their growth.
In the later half of 2018 and early 2019 we saw several major banks drive an initiative to outsource a variety of key functions ranging from software developers, internal recruitment personnel, risk management functions and even compliance. The two main locations of choice were Poland and India. While the strategy of outsourcing does save costs in the short term, the long-term effect on quality and efficiency can be significantly impacted. Moving into 2020 and the years to follow, there is an optimistic feel in the market around bringing a large amount of the outsourced jobs back to the States.
If you have hard-to-fill vacancies, or want to discuss your hiring needs for 2020, get in touch with Selby Jennings today.
Selby Jennings is a leading specialist recruitment agency for banking and financial services. For more than 15 years, we have given clients and candidates peace of mind that the recruitment process is in expert hands. Our continual investment in best-in-class technologies and consultant training enables us to recruit with speed, precision and accuracy. Today, Selby Jennings provides contingency and retained search recruitment across 11 offices in 6 countries. Contact us to find out how Selby Jennings can help you.