In this post-COVID and technology-driven world, the hiring trends in financial services have changed a lot within just a few years. To stay both relevant and competitive, financial firms need to adapt.
On the employment front, the world of financial services faces challenges.
4 out of 5 financial institutions are worried about staffing, and the labor shortage in banking will persist long after the COVID-19 pandemic, according to this publication from American Banker.
On top of that, the average age of a financial advisor is 55, and one-fifth of all advisors are over 65. In less than 10 years, over 111,500 of those advisors will retire, accounting for over one-third of the industry workforce.
Suffice to say, the industry at large has its concerns.
To stay ahead, hiring and retention strategies will need to change. Check outs some of the trends.
Later, the Biden administration dropped its emergency rule that required private employers to mandate COVID-19 vaccinations and regular testing.
Firms like Goldman Sachs and Morgan Stanley ended their mandates, and many other firms have loosened their restrictions.
In short, 2023 looks like a "back to normal" year.
At the same time, COVID-19 is not completely gone, and private employers can decide how they want to handle mask wearing and dealing with sick or exposed employees.
According to ZipRecruiter data, the share of jobs that explicitly state that workers can be remote has nearly tripled from pre-pandemic, from roughly 4% of in 2019 to nearly 12% of jobs in 2022. Accounting and finance saw notable increases in remote jobs.
Heading in to 2023, the number and share of remote work options will plateau or decline, as more and more employers want their staff in the office. This LinkedIn study shows that trend under way.
At the same time, the demand for remote work options is increasing among employees and job seekers. From our view, there should be a balance.
There is nothing wrong with hiring in person and recruiting the local vicinity, but don't rely exclusively on that approach. Maybe your area has a small talent pool, or the cost of living is quite high, and some of the talent left the area.
Don't leave any talent on the table. Today's technology makes it possible for talented people to work from anywhere.
As far as the financial services industry is concerned, it's all hands on deck.
So, don't limit your hires to a narrow and rigidly defined set of requirements.
Sure, some roles require a special license or certificate, and that makes sense.
But for other jobs, do they really require an advanced degree? Do they really require that much experience?
Can other skills, qualities, or career accomplishments be considered?
Advanced degrees and experience are great, but in a tight labor market, you have to find talent in other ways.
For whatever it's worth, companies like Bank of America have recognized that.
Not everyone will have your desired experience level or skill sets...
But if the role can allow for it, hire someone with potential.
For your part, place emphasis on good character, work ethic, being a team player, and a willingness to learn and be trained. They'll be an investment, but if you work with them, they'll make it work for you.
After all, things could be worse...
The firm hires someone who looks great on paper, but they're toxic in the workplace. They don't get along with others, they destroy morale, and people want to quit... and they do. Enter the Great Resignation.
... and the hiring process starts all over again.
You don't want a bad hire, and one way to improve hiring IQ is to incorporate aptitude and psychometric testing.
Warren Bobrow, an industrial psychologist and Founder of All About Performance, an HR consulting firm that helps companies with pre-employment testing, skills assessment, and employee engagement, shared his view on hiring and testing:
"Don't leave it to chance. You want to nail down the hiring process to a science as much as you can. With job-related assessments, you can determine who has the skills required for the position, what motivates them to do a good job, and how well they'll fit in with your team and company culture."
Banks and investment firms, for their part, can promote the industry and cultivate the next generation of talent.
Many financial firms on Wall Street, including Goldman Sachs, are promoting internships and encouraging participation among those less represented in the industry historically, notably women and minorities. The more talent, the better.
To maintain a dynamic workforce and serve clients effectively, the industry must tap all sources of potential.
In the past, it was easier to hire someone by offering more money.
For the right price, they'd do work they don't want to do, and they'd put up with long hours in a stressful environment.
... and they'd keep their mouths shut, too!
Not anymore. Relying on money is one of the hiring trends of the past. Ping pong tables and free kombucha at work are not the solutions either.
Nowadays, banks and investment firms must look beyond money. Employees want more work-life balance than ever before, and they want meaning in their work.
According to a Harvard Business Review study, 9 out of 10 people are willing to earn less money to do more meaningful work.
When companies make positive changes to their work culture, it becomes a selling point in the hiring process.
If you don't change, rest assured your competitors will.
Expanding the talent pool and making your firm more attractive to job applicants is a good thing, but it's not always enough.
Your staff may already be stretched thin, and there are not enough financial resources to simply "throw bodies" at a task.
This is where AI, automation, and outsourcing can help.
Machine learning can help in areas like client communication or data analysis.
Some work is very routine and mundane, like entering data and downloading files. Having high-skilled people do that work is an efficient use of their time and company resources.
In that case, you can automate these routine and mundane workflows through RPA (Robotic Process Automation). Or if you're not sure how to do it, you can partner with a team like Empaxis, which helps banks and financial institutions automate and streamline workflows.
Sometimes banks and other big firms need to hire a large team to get started on a project right away. But going through a hiring process is incredibly time-consuming and stressful.
Outsourcing is the next best option.
When banks and investment firms partner with an outsourcing firm like Empaxis, they don't have to worry about staffing issues anymore.
A company like Empaxis, which provides middle- and back-office support for banks and large investment organizations worldwide, has resources ready and trained to help. As you ramp up or down, Empaxis can easily adjust its staffing to meet your labor requirements.
As the hiring trends show, financial services firms need to stay competitive and adapt, especially in a labor shortage.
Here are four major takeaways:
By following the trends and making changes, you will be more successful.