Welcome to 2022: the candidates' market for banking jobs
The full figures for 2021 and are in, and in case there was ever any doubt, last year was an absolutely enormous one for finding a new job in many areas of banking and financial services. The only problem? Comparatively few people wanted to move.
The chart below shows the growth in the number of jobs posted on eFinancialCareers in 2021 compared to 2020. Job opportunities grew exponentially - especially if you worked in a front office role. Back and middle office jobs were less plentiful last year, with job opportunities falling in middle office areas like risk, operations and compliance.
While front office job opportunities increased wildly, however, enthusiasm for changing jobs in financial services was more muted and candidate's motivations for switching roles became more complex. "It's not all about the money," reflected Mike Karp, CEO of Options Group. Even as banks whacked up salaries in their desperation to hire more juniors in areas like M&A, they therefore didn't always get a response. Some candidates, meanwhile, complained bitterly of being hit-up with relentless recruiter approaches. "There's a shortage of A players," adds Karp. "- Everyone wants to hire the best young talent, and it's not easy to find."
The upshot is that we're going into 2022 with a hiring hangover from 2021. The chart below also suggests that divisional recruitment lags divisional revenues. - Fixed income sales and trading revenues were up 41% in 2020 according to data firm Coalition Greenwich, and this fed through to the enormous increase in trading job opportunities last year. In 2021, it was M&A and equity capital markets revenues that soared, and hiring this year is likely to reflect that.
Headhunters working in M&A and ECM say both areas are already very busy. There's no sign of a lapse in hiring, says Logan Naidu at search firm Dartmouth Partners - January begins as December left off. Hence, we're already seeing JPMorgan trying to poach newly qualified accountants to become investment banking analysts in Europe, and we're already seeing boutiques like Centerview Partners hiking analyst starting salaries to $130k, $10k more than the upper boundary set last year.
It's not just investment banking divisions, though. In most front office areas of finance, 2022 looks like being a candidates' market. If you want a new role, now is the time to negotiate heavily. Pay inflation is a real issue and Karp says expectations are already unrealistic, so banks may resist wilder attempts to extract compensation increases, but lifestyle is the new perk. If you want to work remotely, or part-time, or flexible hours, this is the time to table those demands and to get them locked-in contractually. Banking is a cyclical industry; the winds may not always be so balmy for jobseekers and banks may be less willing to make lifestyle concessions in six months' time.
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