Hedge Fund Hiring: Why Engineering Talent is Becoming Harder to Secure

If it feels like the talent pool for engineers is shrinking, you’re not imagining it. 

We sat down with Shota Berdenishvili, our Principal Consultant and expert in hedge funds, HFT and prop trading, to look at why the number of top level candidates is falling and what firms can do to future-proof their business against talent shortages. 

Engineers who have the knowledge and experience to work for hedge funds are very specialized. What effect is this having on recruitment? 

“There’s been an uplift in base salary. £140k – £150k base is typical, with some going as high as £170k or £180k. One major player for example, is paying a little bit over the market average right now because they’re playing a bit of catch-up in terms of building a team that is more business-aligned as well as being technically sound.  

“Essentially, if you’re headhunting, you’re probably going to have to be quite aggressive with your offer, especially if you want to avoid losing a candidate to a counter offer. So far this year, every single candidate I’ve placed has received a counter offer which is unusual. 

“I had one recently where the counter offer was about £70k more, which isn’t uncommon for a hedge fund, but this was an investment bank, and that level of uplift is unheard of. 

“What that tells me is that the competition for engineers in this space is high, and firms can’t afford the loss of business and disruption that comes from losing a talented engineer.” 

Does that inevitably limit the pool of available talent? 

“It does. Engineering talent itself is niche, but front–office, low-latency engineers with hedge fund or banking experience is a niche within a niche. If you’re restricted by a salary band and can’t offer a package that is at least a £20k - £30k bump, it’s very hard to convince someone to leave an existing role. And even then, you’re probably going to get counter offered. 

“So, it’s not really the number of engineers that is dropping, it’s that the roles are becoming more niche and demand is outstripping supply unless you can make your offer more attractive.” 

How much is AI affecting the types of available roles? 

“The big pull for companies adopting AI is obviously the idea that you can speed things up and streamline processes. And that will inevitably lead to some entry-level roles disappearing. But the front-office roles are only being affected in the sense that there’s expectation of tasks being completed more quickly. You can’t really remove the human element for critical engineering challenges.

“What I expect to see over time is automation of grad roles and early software engineering jobs, but mid to senior-level hiring either staying the same or even expanding.” 

What do hedge funds need to be thinking about in terms of future recruitment and dealing with potential talent shortages? 

“It’s not a major shift yet, but it looks like banks are gearing up to run traditional assets on blockchain infrastructure. The benefits in terms of enabling faster settlements, greater transparency, increased liquidity, and more automation are very attractive. 

“Financial institutions such as JP Morgan, Goldman Sachs, HSBC, UBS, BNY and others are investing heavily in this technology so I would be very surprised if this doesn’t become the eventual standard. 

“This being the case, if you want to stay at the forefront of the market, I’d be looking at hiring engineers with experience in blockchain technology who at least have the ability to expand into this area. Engineers with those skills are going to be in huge demand and you don’t want to be the hedge fund who in a few years is scrambling to find engineers with this skill set. 

“Beyond that I would be looking at the salary bands you’re operating under. Too much restriction in this area when it comes to engineers is going to put you at a major disadvantage. I know this isn’t easy for some banks where there are a lot of hierarchies and bureaucracy in the way. But given where I expect the space to be in a few years, now is the time to start working on how you’re going to attract the best talent.” 

Whether you're making a critical hire today or planning how your team will evolve over the next 12–24 months, Selby Jennings can help you identify, attract, and secure the specialist talent needed to stay ahead. To discuss your hiring strategy or a specific requirement, request a call back for a confidential conversation. Or, if you’re a fintech professional considering your next career opportunity, browse our latest opportunities here.