City jobs down 17% in quarter three as trading conditions remain tough

The number of new City jobs created in Q3 (ending September) 2011 has dropped 17% from the same period in 2010 says Astbury Marsden, a leading financial services recruitment firm.

According to Astbury Marsden, 12,750 City jobs were created in Q3 2011, down from 14,900 in Q3 2010.

However, Astbury Marsden says that decline in new jobs has moderated in the last few weeks with 3,840 new City jobs created in September 2011, a 5% decline on the 4,030 City jobs which were created in August 2011.

Mark Cameron, Chief Operating Officer at Astbury Marsden, says: “The Eurozone crisis has thrown an entire tool box into the business plans of many investment banks. With performance so weak, cost cutting has been aggressive.”

“But it is not unrelenting gloom, with just a one way flow of jobs out of the door. Jobs are still being created across the market. However, these are currently focused on the regulatory and operational sides of City firms; the market for income producing front office jobs is weaker.”

“We are still seeing demand for business analysts and project managers who can help lower the cost base of banks through efficiencies. Investors are looking at the banks’ cost to income ratio like never before and banks are happy to invest in initiatives that can improve that.”

Mark Cameron explains that one trend they have noticed over the summer is for line managers in investment banks to have their requests for new staff cancelled by more senior staff.

Explains Mark Cameron: “That normally means that teams in banks are still working very hard and are under resourced – however, the need to keep costs down means they can’t make those otherwise essential hires. For many bankers, that is translating into more late nights and early mornings.”

Areas of demand
Astbury Marsden explains that demand for regulatory and compliance staff still remains robust, with the recent rogue trader scandal at UBS adding to pressure to staff up in this area.

Mark Cameron says: “Another area of emerging demand is for staff to help out with US tax compliance checks. Banks are reviewing their clients and their own activities in Europe to make sure that they don’t fall foul of the IRS.”

“With so much political focus on banks they know that any slip-ups in this kind of area are going to attract dramatic sanctions.”

Astbury Marsden adds that another pocket of demand within the City is in preparation for a new single European securities settlement platform. This will be used for almost all securities that are traded within Europe and is expected to be operational by 2015.

Astbury Marsden explain that the platform will be operated by the European Central Bank and will significantly reduce the cost of cross border settlement fees, which are on average about ten times higher than domestic fees.