City hiring activity winds down in anticipation of bonus season
According to Astbury Marsden, 3,212 jobs were created in the City in November, down by 5% on October. However this follows a busy late summer and autumn, and is a strong finish to the year, ahead of an average 25% increase in the number of new roles over the last 12 month period compared to the previous year*.
Astbury Marsden explains that hiring activity in the City is now starting to wind down somewhat in anticipation of bonuses being announced over the Christmas and New Year period.
Astbury Marsden adds that despite a recent uptick in trading volumes on banks’ Fixed Income, Commodities and Currencies desks as a result of uncertainty about US and European monetary policies, hiring in these areas remains subdued due to the pressure of regulatory capital requirements.
By contrast, a surge in recent M&A deals, with Thomson Reuters reporting that global M&A activity has hit a seven year high, should increase hiring into M&A support. The increase in M&A activity has been driven in part by consolidation in the oil and gas industry as oil prices drop to $80 a barrel and below. In the UK very substantial deals are also anticipated in the insurance, telecoms and pharmaceuticals sectors.
Adam Jackson, Director at Astbury Marsden comments: “Compared to the same time last year, the City has had a strong run recently, so perhaps it is not surprising that with the bonus season approaching, we are hitting a lull. City staff are waiting to see the size of their bonus cheque before they move so there is less replacement hiring going on.”
“Ongoing restructuring is still very much the biggest driver behind hiring the City at the moment, but we also expect job creation to respond to trends within the market.”
“At the moment M&A activity is buoyant, and some very big deals are being talked about. If that continues that will feed into hiring for investment bankers at all levels, staff to conduct due diligence and provide systems support, as well as to a certain extent to the trading and equity sales desks.”
Astbury Marsden adds that the banks’ ongoing restructuring programmes, regulatory pressures and the drive for efficiency are also creating new opportunities for specialists that can help the banks meet their need for:
• Systems integration and increased digitisation to reduce costs
• Real time reporting systems that can support risk management and monitoring
• Regulatory experts to help banks prepare for the ring-fencing of any retail banking operations and put the necessary systems in press
• Improved cyber security in line with regulatory expectations.
*12 months to the end of November.