Competition for talent in the financial services sector has traditionally been high, with skilled individuals in constant demand. Recently, this trend has become far more pronounced: hiring activity has accelerated to the point that companies are investing more than ever in partnering with expert talent acquisition professionals. At the same time, the bigger banks have begun to move away from purely using in-house hiring teams and returned to executive search firms with wider networks and specialist talent acquisition knowledge.
This trend has come to define hiring across the wider financial services market too, not just banking. Asset managers, for example, are investing far more in talent acquisition, while many private equity firms are struggling to fill roles that require employees to come into the office more than a few times a week. Travel restrictions due to the COVID-19 pandemic have dramatically reduced the availability of talent from overseas locations like Australia and New Zealand, and Brexit has made it more difficult to recruit from mainland Europe. All of this is exacerbating the war for talent.
The emergence of competing sectors such as fintech has also cannibalised the traditional financial services talent pool – these firms have in the past looked to the tech industry when hiring, but are now faced with an increase in regulation, necessitating financial services knowledge and experience.
The state of financial services recruitment
A recent survey by the CBI and PWC found optimism in the financial services sector as business volumes rose steadily. Yet 22 percent cited labour shortages as a concern for future investment - in line with the long-term average and the previous quarter. A number of large banking groups, as well as smaller financial services firms, have recently put fees up for particular roles in order to further incentivise their talent partners, a trend that we have not seen since the early 2000s.
At the same time, many organisations are looking to improve their diversity and inclusion performance. This has led to especially high competition for diverse candidates, leading businesses within the financial services sector to headhunt the same candidates from one another, further inflating salaries, but not widening the talent pool.
The sector needs to do more. More remote working opportunities, more diverse candidates and more action to unlock hidden talent wherever it is located. By doing this, businesses will be able to increase the overall supply of qualified and capable candidates. This approach presents an alternative to simply competing ever harder for those already working in financial services organisations.
The pandemic introduced very rapid changes in working patterns across the industry, and in some instances educated some firms on the benefits of agile working. The challenge now is for companies to retain these benefits without losing their identity and culture. Recruitment will form a very large part of this, and the strategy will need to come from the senior management of the firm.
How to get ahead of competitors
In the race to attract and retain top talent, working effectively with executive search firms and contingent recruitment partners is your first and best head start. Expert talent acquisition professionals know their markets, both historically and at present, and can offer the best advice on how to stand out to the type of talent you are looking to attract. Additionally, they will be able to introduce you to talent from a broader range of backgrounds, empowering you to think outside the box with respect to how you define and access talent.
Beyond the brief
Working effectively with executive search firms is not just a matter of paying more – although this can help, especially with recruitment into senior and executive roles. It also depends on working with specialists that have the right depth of knowledge for the market. Benefits specific to the financial services sector, such as buy-outs, long-term incentive plans, guaranteed bonuses and shares all play a part too, and should be part of the discussion from the outset.
To choose the right partner for your talent acquisition strategies, look for experienced, knowledgeable consultants with extensive networks. Ultimately, a long-term relationship will deliver the best return on investment, but the consultant should be doing the bulk of the leg work to find and deliver the most talented candidates.
Competition will be fierce for talent in the financial services sector and related disciplines going forward. To ensure you are attracting the top talent into your organisation on terms that will ensure long-term employee satisfaction, contact Page Executive today to set up an introductory conversation or get in touch on the details below.