Vacancies for financial jobs in London dropped 11% in July to 4,800 from 5,400 in June. The number of individuals within the industry seeking work reached over 14,000, or 32%.
Unemployment is being pushed up due to the growing number of firms cutting jobs. In fact, many european banks and security firms - including UBS, HSBC, Credit Suisse, Barclays and the Royal Bank of Scotland - are all eliminating thousands of jobs in an effort to cut back after reported declines in returns on investment banking.
Eight banks have already announced job losses totaling over 19,000. HSBC alone has made plans to eliminate 30,000 jobs in the UK by 2013.
The decline will most likely add to concerns over the health of the British job market, which has taken many swings from both the government's austerity program and volatile financial markets.
Sharp Job Vacancy Decline
The financial services industry was considered a promising area for job growth only one year ago after banks began rebuilding their teams post recession. Recruitment in the industry typically settles around this time of year, but job vacancy creation has fallen more sharply than last year according to recruiters.
Banks typically cut approximately 5% of vacancies every year, but these cuts are appearing more early than usual. These changes in the finance industry are raising fears of a stagnant, permanent number of staff in the UK.
According to Mark Cameron, COO of financial services firm Astbury Marsden, banks are not just cutting to cut costs in an effort to rebalance after weak revenues, but are looking to cut the bottom 10% and make such cuts at least three months earlier than usual. Cameron told Bloomberg that many of the banks that are cutting staff in the UK may be seeking to hire in other areas due to a stronger demand in Asia than in the UK.
In that direction, private banking firm Standard Chartered plans on adding 2,000 more workers globally by the end of 2011, with CEO Jaspal Bindra saying most of the hiring will be conducted in emerging markets.
Andrew Evans, Chief Operating Officer at global recruitment consultancy Morgan McKinley, believes that those who have not been cut will keep their heads down due to the uncertainty of the job market. He describes the situation in Britain as a “perfect storm,” adding: “There is a real lack of clarity on how the rest of the year will play out.”
LSBF Program To Offer Job Guarantee
Students at the London School of Business and Finance (LSBF) will soon be getting a new program that guarantees undergraduates a full-time position within six months of graduation. The Trium program is believed to be the first degree of this sort to be offered in the UK, and has four pathways to choose from - financial services, marketing, international business and accounting.
When speaking about the new Trium program, Vice Rector James Kirkbride stated: “"We pride ourselves on our innovative approach to education and believe the Trium program will help our students in securing future, long-term employment, primarily by satisfying industry requirements." LSBF is banking on its innovative way to attract new students during high unemployment and high uncertainty.
Trium programs have a three-pronged approach to provide a strong foundation for graduates entering a tough job market. It focuses on the achievement of a bachelor's degree while guiding students through professional qualifications and graduate development. Courses can even be extended to include a year of gaining experience through industry work placement.
For ambitious career-focused individuals, Trium offers opportunities to work toward qualifications including the CIMA, CIM and ACCA financial accreditations. Courses range from £7,250 to £9,950 a year, scholarships and bursaries are available from LSBF.
Key Statistics – UK Unemployment
- One out of every five British youths (16 to 24-year-olds) are unemployed, the highest level recorded since 1992.
- In the largest unemployment drop since the summer of 2000, British unemployment fell by 88,000 from January to April to an estimated 2.4 million, according to the Office for National Statistics.
- The UK is now at its lowest employment rate in over 20 years, but the number of unemployment benefit seekers increased by over 37,000 in July, the largest monthly jump since May 2009.