January is meant to be the month where financial services workers seek out new roles for better pay or bigger bonuses.
With continued uncertainty over whether Greece will leave the Euro – dubbed the ‘Grexit’ by the financial markets – and the 50% oil price crash since Summer last year, financial services workers, from bankers to accountants, are also not looking to move while companies are also creating less positions than a year ago.
Greece goes back to the Eurogroup today. After a Greek letter containing proposals for economic reform was sent to the group of European finance ministers on Friday, the Eurogroup meets again to decide whether the measures are enough to approve the country’s bailout extension.
“With tumbling oil prices, mounting concerns about how the Syriza election victory in Greece will play out across the Eurozone, and the surprise removal of the ceiling on the Swiss franc, there has been a huge amount for the markets and for the banks to absorb,” said Adam Jackson, managing director at recruitment firm Astbury Marsden in a statement.
“That is prompting the banks to take a little time to review both their overall strategies and hiring decisions. Higher regulatory capital costs had already prompted several banks to downsize or sell their commodities and oil trading teams, but those that still have a significant presence in those markets may be reviewing their short-term plans.”
Astbury Marsden revealed that in January 2015, there were “only” 2,788 new roles were created in Britain’s capital city, which actually marked an 18% drop. However, compared to December, job creation was up 156%, although this is seasonally expected.
The survey also showed that the number of new candidates was down by 50% in January this year, from 7,156 people in January 2014.
“City recruitment was gaining momentum during 2014, but with all the drama of recent weeks it is not surprising that we are seeing a slight pause,” said Jackson.
“The European Union has just reconfirmed its intention to press ahead with complete capital markets union — it’s clear that significant regulatory change will continue to be both a challenge and a potential competitive advantage for the banks for some time to come.
“However, having made significant investments in strategy and regulatory staff, the banks have much of the brainpower they need already in place. There’s naturally a little less urgency involved when it comes to enhancing and expanding those teams, so decision making is a little more considered and costs are more tightly controlled.”
A number of big banks in Britain announced job cuts in their 2014 financial results.
RBS will cut about 14,000 investment bank jobs in the US and Asia by 2019. This is about three-quarters of the total investment bank workforce, which stands at 18,000. However, the bank employs 118,000 people worldwide across all units.
HSBC has already slashed 40,000 jobs over the last three years and aims to cut more.
Meanwhile, Standard Chartered revealed last week that it will also cut another 2,000 jobs by the end of the year.