Traditionally, Q3 is always a slightly quieter period and this year has been no exception. There has also been some reticence in the market, particularly in Accounting and Finance.
Most businesses have announced that there will be no significant change in their hiring strategies post-vote. Of course, business as usual in certain areas does mean a continuing of the near/offshoring model that many banks are implementing in their Finance teams, but there still remains a core Finance function for each business that will not move from London.
Hiring remained reasonably quiet at the beginning of Q3, with many businesses still assessing potential implications of the vote. This said, some areas did see an increase in hiring during this period, namely Audit and Regulatory Reporting. On the contracting side the majority of hiring has come about due to redundancies or whilst they recruit for candidates on the permanent side. There have been very few growth hires on the contracting side.
In the early part of the quarter candidates were very cautious in their approach, with several putting their search on hold, even whilst in the process. This reticence slowly eased as we moved towards the latter months of Q3, however there are still many candidates who are displaying increased levels of caution regarding moves externally.
On the Banking side, remuneration remains a hot topic. Base salary is now a much more important factor than bonus potential for many job seekers, with the recent trend of bonuses being cut or cancelled altogether within Finance. This has prompted some Banks to realign their compensation packages to a more base-heavy package, with the bonus being pre-agreed as a token amount at best. On the buy-side, bonus remains an important factor in the decision making process.
Other factors impacting the external hiring market remain the same as previous quarters, with businesses continuing to develop their internal/direct sourcing model (one major bank has cut their agency spend by almost 90% globally over the past 12 months, whilst another implemented an internal initiative of converting a large number of their temp staff to perm headcount, thus negating the need to hire externally) and non essential roles being moved to low cost locations.
Banks are still hiring sporadically in the Product Control area and we have even seen a few growth hires in this space, although these have been driven by internal re-orgs rather than increased volumes.
Hires are generally at the AVP/Junior VP banding, as anything more junior than this would be sourced directly, or filled with a graduate. Thus, roles in Product Control have required strong and detailed product knowledge in the relevant asset class, an area that many candidates seemed to be lacking in. This could be down to the fact that many Product Control functions have become more automated, along with many production functions being offshored, meaning that candidates are not as involved in the detail as they would have been in the past. Overall, this is an area in which we have seen a real dearth of experience, in no small part due to the fact that most strong candidates will have moved to other areas of the business.
Another function we’ve experienced some volume in is Fund Accounting, split across both Asset Managers and Custodian Banks. Strong funds knowledge has been vital for these positions, and has been the deciding factor in most processes. The other important element to these positions is for the candidate to have strong stakeholder engagement and relationship management skills, as many of these positions will face off to a number of internal and external stakeholders. Some interviews have focused on cultural aspects of the candidate in order to ascertain their abilities in this area. These roles have been far less broad than previously, with candidates being asked to specialise in a small number of areas as opposed to having a broad amount of responsibilities.
As always, there is a demand for candidates with strong regulatory knowledge, particularly for roles within Statutory Accounting. The issue faced when recruiting for roles within this area is that a lot of the more junior candidates want to move into what they deem to be more analytical roles, such as Business Partnering or Financial Planning. Whilst we have seen sustained demand for candidates in these spaces, there are many more candidates looking for roles aligned to these particular areas than there are vacancies.
On the recently qualified side of the market, there is still a significant demand for people from top 10 firms with a Banking/Financial Services focus for any number of Finance oriented positions. However, more so than in previous years, many newly/recently qualified accountants are attempting to move out of accounting altogether and are instead aligning themselves to more Front Office type positions, or a Corporate Finance role in practice. This has been a significant area in which we have witnessed a real lack of talent.
The final quarter of the year is always a difficult one to predict for the permanent market. With most holidays over, businesses and hiring managers generally focus their efforts upon filling as many of their open vacancies as possible. However, there are also the obligatory end-of-year freezes to enable firms to manage their budgets, which vary in respect to when, and how strictly, they are enforced. Most candidates that may have been more active in the early part of the year will buckle in and wait for their bonus at the beginning of 2017 before considering a move externally. Add to this the lingering after-effects of the referendum, and the ambiguity coming from Theresa May on exactly what will happen and when, it all adds up to this being a tough end to the year for Accounting and Finance, and more broadly Financial Services as a homogenous unit.
On the contracting side, we expect to see an increase in hiring when compared to Q3. As we move towards the end of the calendar year, we expect hiring managers to bring in contractors to help push through any additional work/projects that have a deadline either before the Christmas period or the start of Q1 2017.