Fallout from the vote for Britain to leave the European Union has been reflected across the board in July’s employment data, with month-on-month available jobs dropping by 12 per cent.
A year-on-year decline of 27 per cent was also reported by Morgan McKinley Financial Services, which pointed out both figures are not too drastic, given the uncertainty since June’s EU referendum vote.
“Hiring slowed as institutions found themselves in a post-Brexit limbo, but the impact of the referendum was not as aggressive as we expected”, said operations director Hakan Enver.
“Jumping ship in a climate of uncertainty is particularly risky for employees, but we’re also seeing the usual seasonal factors playing out as people take their summer holidays causing a lull in the marketplace,” he continued, adding there’s likely to be a bump again in September.
Adding to the climate of uncertainty in hiring is a predicted dip in mergers and acquisitions activity, according to the professional services recruiter.
Its latest employment monitor report stated any exodus of financial services firms from London has yet to materialise, arguing this would require individual businesses to potentially relocate thousands of employees, which he said isn’t logistically or financially feasible.
Mr Enver pointed out up to a million Londoners work in the financial sector. “Only a small portion of them have the flexibility to up and move to a new country, and no other region can compete with the quantity and calibre of financial professionals.”
Demand for legal and regulatory expertise is expected to rise post-Brexit, he said.
However, supply has been low due to a shortage of qualified candidates willing to move, as well as a failure to get approval for opening up jobs. The two factors combined have resulted in employment numbers being lower than anticipated.
Underlying the compliance employment data is also a divide in public sector versus private sector -side advisory team hiring. Banks are currently recruiting primarily in the public-side for advisory, while hiring on private-side advisory languishes.
Leo Bellometti, compliance consultant at Morgan McKinley, said despite the economic and political landscape, he has seen an increase of hiring in specific areas within compliance: front office advisory, compliance monitoring and investment monitoring.
The average salary uplift for candidates moving within compliance advisory is 15 to 20 per cent, however, some are looking for increases of 30 per cent or more to move and, unlike previously, firms will no longer sanction this and are pushing back, causing potential moves to collapse with salary a sticking point, added Mr Bellometti.
peter.walker@ft.com
