London finance jobs resilient despite COVID-19, Brexit and US election 'triple threat'

·3 min read
UK, London, blurred motion of incidental business people walking to work with view of the financial district behind
The survey also showed a 1% quarter-on-quarter increase in job seekers, while year-on-year figures decreased by 31%, due to COVID-19. Photo: Getty

Financial services in the capital weathered a tough 2020, which saw City jobs remain resilient despite a “triple threat” from COVID-19, Brexit and the presidential election in the United States, which were expected to deliver a blow to the sector.

According to Morgan McKinley’s Quarterly London Employment Monitor, the fourth quarter ended with jobs in financial service seeing a small decrease of 2%.

This was a stark contrast to the beginning of 2020 when overall numbers for the year plunged by 49% compared to 2019.

The survey also showed a 1% quarter-on-quarter increase in job seekers, while year-on-year figures decreased by 31%, due to COVID-19.

Whilst the sentiment of several firms was to continue hiring talent within their organisation, the salaries of new employees dropped slightly to compensate for the current environment.

During Q4 2020, the average change in salary of those moving from one job to another increased by 14%.

As flexibility increases and working from home becomes the norm, there is a possibility that salaries on average may fall to factor aspects such as less need for travel.

“Brexit on its own would have been hard enough” but the City had to “deal with the disruption of the global pandemic and the potential upheaval of the change of leadership in the US,” said Hakan Enver, managing director at Morgan McKinley UK.

Financial Services jobs new to the market quarter on quarter. Graph: Morgan McKinley
Financial Services jobs new to the market quarter on quarter. Graph: Morgan McKinley

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Enver added that despite the mountain of woes, “Q4 ended with jobs seeing a small decrease of 2% which continued to counter the massive drop of 60% in Q2. This shows real resilience and steadiness in stark contrast to the beginning of the year when overall numbers for 2020 fell dramatically compared to 2019.”

Speaking on City firms’ response to the coronavirus pandemic, he said that banks and financial service firms fared well by “adapting quickly” and responding to the needs of their staff and setting up remote working, which “ensured firms to maintain business as usual.”

“Many employers are focusing on hiring when needed and feasible. We’ve seen growth in IT, marketing, and digital roles, whilst auditors outside the big 4 have also been in demand,” he said.

According to Enver, less people were job hunting, “due to a lack of physical meetings, the furlough scheme being in place and the sentiment by job seekers that they wanted to see the year through and restart the job search in the new year.”

But he highlighted a “renewed optimism in 2021” and said that job numbers are “steadily moving in the right direction.”

Professionals jobseekers new to the market quarter on quarter: Q1 2017 - Q4 2020. Graph: Morgan McKinley
Professionals jobseekers new to the market quarter on quarter: Q1 2017 - Q4 2020. Graph: Morgan McKinley

There is a “long way to go on the EU deal” for financial services, Enver noted.

“UK chancellor Rishi Sunak has granted the EU access to UK markets, despite a lack of reciprocation on Brussels’ part. It is too soon to tell if any future agreement will help financial services but it does provide certainty and an opportunity to catch up on lost ground.”

The managing director said that companies are “now looking at new fast-growing” business options where London is already globally competitive, that they can “add to.” This includes “foreign exchange and derivatives or perhaps becoming a centre for sustainable finance and the hub for fintech.”

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