Banking – UK Finance Labour Market Trends Report, September 2024
UK Banking Set for Rebound in 2024 Amid Political Stability and Regulatory Reforms
Key findings include:
- 8% shrink in the number of vacancies in the banking sector across the UK in 2024
- Risk & compliance remains dominant in banking recruitment, despite a 19.6% vacancy drop.
- Greater London set to regain 48.1% share of banking vacancies.
- Goldman Sachs leads recruitment with 88.8% vacancy increase in 2024
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The UK stands out among G8 countries due to its political stability, with the government expected to remain in power for up to 10 years. Consequently, 2024 could mark a turning point for UK banking, thanks to recent deregulation reforms and stable interest rates. In particular, London is forecast to see a 2.5% rise in banking vacancies, increasing from 46% to 48.5%, whereas the rest of England and Wales face a 12.3% decline. Moreover, private equity firms are likely to divest, as funds near their five-year mark post-pandemic. Additionally, new government plans could unlock £75 billion, potentially boosting pension savings by £11,000 per person. This is according to the latest UK Finance Labour Market Trends report by leading professional recruiter Morgan McKinley and market data analysts Vacancysoft.
Risk & Compliance Lead Banking Recruitment
Since 2022, Risk and Compliance has consistently been the most in-demand area in banking recruitment. Forecasts suggest this trend will persist in 2024, with 4,559 vacancies representing 14.7% of all sector roles, despite a 19.6% decline in vacancies. This reduction is likely due to increased automation of risk analysis through AI, as many banks adopt new technologies like blockchain for transactions. IT Development & Engineering roles are expected to grow by 8.7%, reaching nearly 4,000 vacancies, as banks integrate these technologies. Meanwhile, IT management vacancies have dropped by 5.8%. Overall, the rise in tech-driven roles contrasts with a 22.3% decline in commercial banking vacancies, reflecting the sector’s evolving needs.
2024 Banking Vacancies: London Recovers as Regional Trends Diverge
Greater London is forecasted to maintain the largest share of banking vacancies in 2024, with an estimated 48.1%, or 14,964 total vacancies, nearly returning to 2022 levels after a 3.1% decline from 2022 to 2023. Edinburgh is expected to hold second place with 1,532 vacancies, although both Edinburgh and Glasgow are projected to see significant declines of 20.4% and 28.3%. Consequently, Scotland’s share of vacancies will likely drop from 10.6% to 8.8%.
Conversely, Northern Ireland and the Southwest are the only regions forecasted to grow, with Northern Ireland up 9.5% and the Southwest 9.4%. However, Manchester is set for the steepest decline, falling 45.6%.
Ross Sailes – Associate Director – Morgan McKinley comments:
“Overall, UK inflation has been gradually decreasing. However, as Bank of England’s economist: Rob Elder referenced at one of our recent events, the central bank has been keeping a keen eye on the stubbornly high wage and services inflation. Recent data has shown that wage inflation is finally subsiding, theoretically paving the way for a number of rate cuts over the coming year. This shift could not only positively impact consumer sentiment but also give a welcome boost to bank balance sheets as their sizable bond portfolios increase in value. Should this materialise, we could see increased investment in projects, expansion plans and emerging technologies such as automation and AI – developments that would significantly benefit the recruitment market.”
“Despite the challenges, there are reasons to be optimistic. The outlook for 2025 points to a gradual recovery, fuelled by London’s continued dominance as Europe’s financial capital, reforms aimed at deregulating the financial industry, and more stable inflation.”
Investment Banks Surge in Vacancies for 2024, While Retail Banks Decline
In 2024, investment-focused banks are set to see significant growth in vacancies. Goldman Sachs is forecasted to have an 88.8% increase, reaching nearly 600 positions, following the opening of its Birmingham branch. Bank of America is expected to lead with a 118.8% surge, bringing the total to approximately 344 jobs, while JP Morgan Chase will see an 8.2% rise, with vacancies reaching 2,714.
In contrast, retail-focused banks like NatWest Group and Nationwide Building Society are predicted to see steep declines, with vacancies dropping by 49.1% and 48.1%, respectively. However, Santander stands out, with a 33.7% increase, due to its recent structural changes.
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