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Press Release: A month of contradictions

Press Release: A month of contradictions

Submitted by global_admin on Mon, 05/16/2016 - 08:29
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“It certainly felt like a uninspiring month. The market was volatile and it was tough on organisations. Hiring was restricted and organisations were slow to release jobs. So the numbers were somewhat comforting and perhaps there is light at the end of the tunnel.”

May 2016

London Employment Monitor April 2016 highlights:

  • Increase of 11% month-on-month for available jobs 
  • Decrease of 22% year-on-year for available jobs
  • Increase of 5% month-on-month in job seekers
  • Increase of 18% in job seekers year-on-year
  • Brexit looms and fintech booms

It’s a tough market out there

Following in the footsteps of the previous month, in April the market continued to struggle. The main drivers for the malaise were poor macro figures and the approaching referendum. On the back of these news, it was somewhat surprising that there were increases in both available jobs and job seekers. The number of available jobs increased 11% from 7,215 in March to 8,070 in April. Job seeker numbers were slightly positive with an increase of 5% from 12,998 in March to 13,679 in April.

“It was a subdued April,” said Hakan Enver, Operations Director, Morgan McKinley Financial Services. “Therefore, the positive monthly figures were somewhat of a surprise. Following the trend from March, we had more poor macro figures and more news of redundancies, which is testament to banks slowing down.” 

“It certainly felt like a uninspiring month. The market was volatile and it was tough on organisations,” said Enver. “Hiring was restricted and organisations were slow to release jobs. So the numbers were somewhat comforting and perhaps there is light at the end of the tunnel.” 

The asset management industry which has been doing well recently, also slowed down in April. “They haven’t ceased hiring, but there is an atmosphere of reflecting on their needs for the rest of the year,“ said Enver. ”Overall, bank margins are down, which inevitably results in cost cutting measures. With all this uncertainty, people just aren’t sure of the near-term future.” 

“We can expect a muted May and June. Although June is normally a busy month, everyone is waiting on the results of the brexit referendum,” said Enver. 

The UK economy weakens

The economy slowed down in April, with global growth worries taking a toll on the UK. The slowdown is reflected in listed companies, which are already feeling the pressure on earnings. Ernst and Young reported that the number of profit warnings from UK listed companies was now “remarkably high”. 

Figures released by the Office of National Statistics showed that productivity in the UK fell at the faster pace since 2008. These negative factors were evident in the employment figures, which showed a rise in unemployment for the first time since mid-2015. Those out of work increased by 21,000, with the unemployment figure remaining at 5.1%. The harsh reality of an economic slowdown and its effect on employees was front page news in April as BHS, a UK retailer founded in 1928, went into administration putting 10,000 jobs at risk. The very next day another retailer, the 116-year old shirt maker firm Austin Reed, which employ 1,200 people, also filed for administration.

Brexit looms on the horizon

The upcoming June Brexit referendum was very much in the news in April. There are fears amongst employers that jobs will be lost if the UK decides to exit the European Union. In a report by PwC, it was estimated that as many as 100,000 jobs in the financial services sector could be lost if the UK decides to exit. The City of London, which has backed Britain’s EU membership, now fears an exit of bankers and a negative effect on Sterling in the event of a Brexit. Angel Gurría, Secretary-General of the Organisation for Economic Cooperation and Development accused those campaigning for Britain to leave as being “delusional” and warned that the average UK household stood to lose £2,200 if the UK left the EU.

“The leave campaign is doing well in the polls, but it’s still too early to make a prediction,” said Enver. “In the two previous referendums the polls have been wrong and it’s important to remember that despite today’s general perception and popular beliefs, things can change last minute.”

Fintech still shines

Fintech has been a subject discussed regularly in our London Employment Monitors. Despite the challenges in the finance industry, fintech continues to attract investment and poses a significant challenge to traditional banking jobs. According to a note from Citigroup, the rise of fintech could reduce traditional banking jobs by as much as 30% in the next decade. This observation has also resulted in strong competition amongst finance centres with New York battling it out with London to be the global capital of fintech

Investment banking is feeling the squeeze

The poor performance of investment banks continues. Thomson Reuters figures showed a 29% decline in fees year-on-year in the first quarter, making it the worst quarter since 2009. The M&A and IPO market remains challenged, with employees in the City being warned to expect cuts to both jobs and bonuses over the coming months. A concrete example of the pressure that investment banks are facing was Nomura, one of the biggest Japanese banks, who could be cutting as many as 600 jobs in its European equities business in an effort to “rationalize certain areas” of its European and US businesses.

“When M&A and IPO activity is strong, it indicates confidence in the market,” said Enver. “Currently, many companies are dragging their heels when it comes to M&A activity; not a positive sign.” 

The average salary for those professionals moving from one organisation to another was 15% in April 2016.

Financial services jobs new to the market April ‘16

Financial Services Jobs Market April 2016

Professionals seeking new roles April ‘16

Professionals Seeking New Roles April 2016

Average change in salary each month April ‘16

Average Change in Salary Each Month April 2016


Further press information:
Sharmee Mavadia or Rebecca Ly
Tel: 0207 092 0023                                    

Notes to editors:
Statistical methodology
Monthly new jobs and new candidates
From May 2013, the London Employment Monitor now uses Morgan McKinley’s own weekly records of new permanent and temporary job vacancies and new candidates registering with the firm for employment. Statistics for the full market are derived using Morgan McKinley’s market share.
* Chart (3) illustrates the average percentage change between original salary and new salary offer for professionals securing new roles each month.
About Morgan McKinley
Morgan McKinley is a global professional services recruiter connecting specialist talent with leading employers across multiple industries and disciplines.
With offices across Ireland, the UK, EMEA, Asia and Australia, the company’s professional recruitment expertise spans banking & financial services; commerce & industry and professional services. Morgan McKinley is a preferred supplier to many of the major employers in its specialist sectors and thousands of smaller local firms.
In 2013 Morgan McKinley was ranked 39th out of 100 in Recruiter magazine’s Hot 100, which ranks recruitment companies in the UK.
In 2013, Morgan McKinley was recognised in the Irish Independent’s listing of Best SME Workplaces in Ireland. We are also proud to be ranked in Deloitte’s Top 20 Best Managed Companies in Ireland for 2013.
In 2015 Morgan McKinley was awarded Best Banking & Financial Services Recruitment Agency at the Recruiter Awards 2015.

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