Connecting to LinkedIn...

W1siziisijiwmtyvmdevmtgvmtevmdyvntkvns9zagfyzs1wcmljzs0xmdeznji2xzk2mf83mjbbmv0uanbnil0swyjwiiwidgh1bwiilcixmdawedqwmfx1mdazzsjdxq

December dip completes H2 employment downturn

Morgan McKinley has published its London Employment Monitor for December, confirming the figures for the tradtionally slow employment month were low, as expected.

 

There was a decrease of 33% in available jobs month-on-month, while jobseekers decreased month-on-month by 32%.

 

Morhan McKinley stated month-on-month numbers continued to fall by a third - an excessive drop. Save for a slight increase from September to October as expected, the general H2 trend has been downward.

 

H1 saw positive growth for both vacancies and jobseeekers, however year-on-year figures for available jobs showed a 7% decrease and year-on-year job seekers increased by 11%.

 

“Over the course of 2015, we saw a tale of two halves,” says Hakan Enver, operations director at Morgan McKinley Financial Services. “In the first half (H1), there was a general positive growth in sentiment and an overall appetite to hire. Things took a turn during the summer period, particularly when heading into September, where we didn’t see the anticipated increase in volumes. In fact, numbers decreased even further. H2 almost wiped out the positive H1 six-to-twelve month trend.”

 

From a jobs availability standpoint, 2015 saw hiring freezes by many institutions as well as scaling back, such as Barclays’ announcement of a 20% workforce reduction in China. With commodities spiralling down and the price of oil approaching $30, commodity hiring has decreased and businesses are reducing their commodity related units.

 

 

 

Many of the challenges that have contributed to the lower than anticipated numbers of H2 2015 will continue into 2016 and are likely to impact future trends with varying degrees of magnitude: a market that remains challenged, interest rate hikes in the US and UK, the Brexit vote now anticipated in June/July 2017 and the commodities dip. The debate concerning finance institutions leaving the City is still ongoing and if HSBC decides to move its headquarters from London to Asia, it will take a significant toll on numbers. Despite this threat, the warning of moving HQ has softened, particularly with the ongoing current troubles faced in the Asian markets.

 

The biggest and perhaps most awaited news event of the year passed without much trouble as the Federal Reserve raised interest rates for the first time since 2006 and many market participants experienced the first Fed rate hike of their careers. The Fed had been careful to communicate their intentions throughout the year and since they did not hike rates in November, it became clear that December would be the month that they did.

 

“Now we’ve had the hike, the question is what will happen in 2016?” said Enver. “The market’s perception and what the Federal Reserve is communicating in regards to how many rate hikes can be expected in 2016 differ somewhat, so we should prepare for some volatility.”

 

 

Whilst H2 2015 was a tough environment for financial services, there were some bright spots. In December, the Bank of England announced the official end of the banking crisis and all of Britain’s seven largest lenders passed stress test assessments, albeit without consistently flying colours. This should pave the way for businesses to commit to their hiring plans for 2016.

 

From a finance-sector job market standpoint, January has gotten off to a promising start. “Despite a rude awakening to the start of the year from financial markets, we’ve actually had a record number of interviews requested in the first week of January, indicating an uptick could be ahead,” said Enver. “There’s enough evidence to suggest, going into the new year, that we could expect that trend to continue upward for both jobs open and professionals seeking new positions.”

 

Whilst UK economic growth overall was weaker than expected, in part due to the finance sector and though Storm Eva threatens to shave as much as 0.25% off UK growth, private sector job growth made for a strong year-end finish for the UK economy overall. The upturn, which the Confederation of British Industry's director-general Carolyn Fairbairn credits to growth in business services is expected to continue into 2016.

 

The regulators signalled that they are taking a more accommodating attitude to financial institutions, at the very end of the year with the FCA reporting that it would not publish its findings into British banking culture. The move can be viewed as surprising, since the study was one of the regulator’s key aims for 2016. “One can only speculate as to why this statement was made right at the end of the year. Due to the timing, many will have completely missed this bit of news,” says Enver.

 

The average salary change for those moving from one organisation to another dropped considerably to 12% in December. It hasn’t been at this level since October 2013. There is no evidence to suggest this may be a trend, particularly as the month not only proved to show more junior and intermediate level hires being made, but those hires were coming from more support and administrative lead functions. It appears that many banking organisations held back on making offers to those in projects and regulatory aligned disciplines. These areas, amongst others, are what have fuelled a salary boom in the last couple of years, particularly with the necessity to satisfy demand from the regulators, as well as the impact of regulation around the limiting of bonus pools to individuals.

 

 

 

Articles similar to London Employment Monitor

Articles similar to jokseekers