The number of jobs available in the capital’s financial services sector – along with those seeking them – has dropped dramatically in the past year, according to a quarterly recruitment monitor.
Recruitment and human resources firm Morgan McKinley’s summer London employment monitor, published today (July 7), showed a 50 per cent fall in the number of jobs available compared with the same point a year ago.
The number of jobseekers was also down 19 per cent.
Despite this, the second quarter of the year showed some bright spots: job seekers increased in May and June by 7 per cent and 5 per cent respectively, month-on-month. June also saw a 3 per cent month-on-month increase in jobs available.
Hakan Enver, managing director of Morgan McKinley UK, cited political wrangling and uncertainty in the UK as major factor behind the annual drop.
The looming resignation of Theresa May as prime minister and ongoing Conservative party leadership election have only served to cause more concern, he said.
"While most sectors in Britain have seen an increase in hiring despite the deadlock, the financial services sector is especially vulnerable to regulatory uncertainty and remains slow," said Mr Enver.
Morgan McKinley noted Office for National Statistics figures showing the highest employment rates from the UK since 1971 were published only last quarter, while hiring in the technology sector in the capital had remained relatively stable, having risen by 60 per cent since 2010.
But Mr Enver said: "Major banking organisations, as well as those from the wider financial services space, have refrained from investing in talent due to the lack of clarity.
"Furthermore, banks have made no secret of announcing job cuts, various restructuring and moving jobs overseas, all of which contribute to the ongoing sluggishness of City hiring with countless projects and plans on hold.
"If we have a no-deal Brexit, those projects and all the jobs they would have generated go from being on hold to being cancelled."
This weekend, Deutsche Bank announced it would carry out a global restructure and was looking to cut 18,000 jobs around the world.
The German lender operates out of a large London hub in which it employs up to 8,000 staff.
While this round of cuts was not directly linked to Brexit, plenty of other institutions have held off hiring or investing in the UK until more clarity on the UK's future relationship with the EU has been established.
Morgan McKinley cited HSBC and Nomura Investment Bank as large institutions that have recently cut numbers in the UK.
Meanwhile the CFA Institute’s Brexit barometer survey has consistently shown how its finance professional members considered Brexit to have had a significant impact on their employers’ strategy in the UK.
In the latest edition, published in 2018, more half (63 per cent) of respondents said they expected firms with a strong UK presence to reduce their presence in the country, echoing similar numbers in the two preceding years.
"Whoever takes up residence on Downing Street must remember that financial services is the single largest contributor to Britain’s tax base," said Mr Enver.
"If those jobs keep being treated like collateral damage, eventually someone else is going to have to pick up the tab for the government’s expenses."
