Morgan McKinley have released the results of a survey of 194 HR and hiring managers in the financial services sector in London on the H2 2010 hiring outlook. The survey found that 76% expect overall City hiring levels to increase (47%) or stay the same as H1 2010 (29%) in the second half of this year.
New job creation was cited by over a third (33%) of managers to be the focus for hiring in H2 2010. With the anticipated increase in hiring, 55% of respondents stated that finding good candidates with the right skills and experience was more difficult (44%) or significantly more difficult (11%) than a year ago.
When asked about the key personnel challenges faced by financial institutions, the majority (42%) of managers felt that the structure of remuneration packages was the top priority. Competitors poaching staff was the next significant concern for 41% of managers and a shortage of talent was identified by 30% of managers as being the third most pressing personnel concern.
With remuneration continuing to be a high profile issue over the last few months, Morgan McKinley asked managers if there were plans to make any changes to compensation packages to attract talent in H2 2010. The majority (71%) anticipate that the bonus element of compensation packages will remain the same and only 17% of managers expect a rise. When asked about salaries 48% of managers expected the average salary to stay the same in H2 2010 although 47% thought it would increase.
According to the London Employment Monitor monthly data for June 10, the average salary for those who secured new jobs in the City was Ã‚Â£53,231, only a 4% decline from the average salary of those taking up new roles in May 10.
In Q2 2010, the average rise in basic pay when changing jobs was 19% compared to 15% in Q1 2010 and 10% in Q2 2009.
Andrew Evans, Managing Director, Morgan McKinley Financial Services commented: “As anticipated at the start of the year, hiring in 2010 was expected to rise significantly compared to 2009 levels and this has proven to be the case. The first six months of 2010 saw job opportunities increase by 26% compared to the second half of last year. The monthly data also reinforces this growth with June 10 job volumes up 49% on June 09 levels. As we move into the second half of the year however, our survey shows HR and hiring managers are split between anticipating a levelling-out of hiring versus continued rises. From May 10 to June 10, there has already been a slight pause with new jobs available remaining relatively steady, down 2%.
“Sourcing and retaining the right talent remains a key priority for HR and hiring managers in the second half of the year. Over half felt that finding the right talent was more difficult than a year ago. While there are not talent shortages across the board, the poaching of staff by competitors continues to be a concern. In turn, remuneration structure is high on the agenda as managers look at ways of retaining and rewarding staff that fits with the current public sentiment towards bonuses, whilst also enabling the City to remain a competitive and attractive place to work.”
The survey of HR and hiring managers in the financial services sector in London found:
Ã¢â‚¬Â¢ 47% of respondents expect City hiring levels to increase in H2 2010 versus H1 2010, while 29% think they will stay the same
Ã¢â‚¬Â¢ 55% said finding candidates with the right skills and experience was more difficult than a year ago – an increase of 3% compared to Morgan McKinley’s January Hiring Market Outlook Survey
Ã¢â‚¬Â¢ 48% expect the average City salary to stay the same as H1 2010 although 47% believe it will increase in H2 2010
Ã¢â‚¬Â¢ When asked about the bonus element of compensation packages to attract talent in H2 2010, 71% expect the bonus component to stay the same, while only 17% expect it to rise
Ã¢â‚¬Â¢ The main personnel issues facing businesses were cited as the structure of remuneration packages (42%), competitors poaching employees (41%) and talent shortages (30%).
City Jobs Market Highlights:
Ã¢â‚¬Â¢ New job opportunities in the financial services sector fell by 2% from May 10 to June 10, however compared to the same time last year, the number of newly available jobs in the City increased by 49% in June 10
Ã¢â‚¬Â¢ The number of new professionals entering the financial services jobs market rose by 3% month-on-month in June 10, while there was a 60% increase compared to the same month a year ago.
Ã¢â‚¬Â¢ The average salary for those securing roles in June 10 was down 4% compared to May 10 but rose 6% on June 09 levels
Ã¢â‚¬Â¢ When changing jobs, the average increase in basic pay received was 19% in Q2 2010 compared to 15% in Q1 2010 and 10% in Q2 2009.
The financial services hiring market in London showed a slight 2% downward fluctuation in the number of newly available jobs, from 5,733 in May 10 to 5,645 in June 10. However compared to the same month last year, June 10 saw a 49% increase in new job opportunities from 3,780 in June 09.
The number of professionals entering the jobs market remains at a similar level in June 10 with a month-on-month 3% increase from 11,730 in May to 12,090 in June. This also represents a 60% increase in professionals newly active in the financial services jobs market in June compared to June last year.
Andrew Evans continued: “Overall, there is still a lack of clarity as to how healthy the financial services hiring market will be over the rest of the year. HR and hiring managers seem divided as to the pace of job growth, although only a very small minority felt the market would move backwards. In addition, with financial institutions awaiting greater visibility on regulatory issues and the impact of the debt issue, it remains to be seen how strong job growth will be over the next six months compared to the first half of the year.”