LONDON–The financial services industry is facing a recruitment and skills crisis, according to a new analysis that suggests a key issue is hiring for adaptability rather than short-term impact.
Paul Cadbury, the former head of payments and strategy with Lloyds Banking Group, told GlobalData, “As McKinsey recently reported, all customer groups – even those aged over 50 – now prefer digital channels. As a result, the key barrier to removing branch and telephone banking – and all the cost-saving this represents – has all but disappeared. This is leading to a massive rethink of the banking proposition.”
Cadbury noted, for example, Lloyds has announced internal restructurings on five occasions over the past year.
“This impacts 27 different business divisions which have all contributed to the approximate 60,000 job cuts the bank has made since its 2008 acquisition of Halifax Bank of Scotland. Roughly 75,000 staff remain,” Cadbury said. “Meanwhile, the number of full-time staff employed by Royal Bank of Scotland has tumbled from 199,800 in 2008 at the time of its government bailout, to 68,600 at the end of September 2019.
Jobs Cut
The GlobalData analysis noted that among the banks announcing job cuts during 2019:
- Deutsche Bank 18,000 (one-fifth of its workforce)
- HSBC 10,000 (4% of its workforce, 17% of its European workforce)
- Commerzbank 4,300 (one-tenth of its workforce)
- Barclays 3,000
- Société Générale 1,600
“Going forward, a recent study by Wells Fargo envisages even deeper cuts. They state that radical automation of back end processes, undertaken by robots and other technologies, will lead to a further 10% of total bank jobs being cut” in the next 10 years, clearing the way for a ‘golden age of banking efficiency’,” said GlobalData. “Looking more broadly at the available ‘Senior’ roles, based on vacancies at present, the overarching trend for opportunities is for specialists with deep technical knowledge.”
Coding Skills Needed
GlobalData further quoted Martin Chavez, CIO of Goldman Sachs, as observing the next generation of bankers will all need coding skills, which he described as important as “writing an English sentence.”
“Whether it be retail banking or beyond, the key trait that will enable an individual to thrive in the future will be a willingness to adapt and learn,” Chavez was quoted as saying. “In an uncertain world, where many skill sets may not be readily available, recruiters and recruitees alike would be best to look for these softer skills; something which is currently very much a secondary consideration when it comes to recruitment. Until recruiters find a way to hire for adaptability rather than short-term impact, the industry will continue to be highly inefficient.”