According to City recruiter Morgan McKinley, the “opaque” process of obtaining a visa – and the unpredictable outcome of the application – is putting potential recruits off at a time when the sector needs new blood.
The City is also losing out because of the ongoing uncertainty over leaving the EU and the impact of a no-deal Brexit.
“News of prime minister Theresa May’s resignation signalled a potential shift in Brexit negotiations in the months ahead, but with no new leader in place, these negotiations remain at an impasse,” said Morgan McKinley UK’s managing director Hakan Enver.
“While most sectors in Britain have seen an increase in hiring despite the deadlock, the financial services sector is especially vulnerable to regulatory uncertainty and remains slow.”
He said that major banking organisations, as well as those from the wider financial services space, have stopped investing in talent because of the lack of clarity.
A number of banks – Deutsche Bank, HSBC and Nomura are the latest – have announced job cuts, restructuring and moving jobs overseas, all of which contribute to the “ongoing sluggishness of City hiring”.
The sector is also keeping projects and plans on hold but, in the event of a no-deal Brexit, those projects and the jobs they would have generated will be cancelled.
“Whoever takes up residence on Downing Street must remember that financial services are the single largest contributor to Britain’s tax base,” Enver added. “If those jobs keep being treated like collateral damage, eventually someone else is going to have to pick up the tab for the government’s expenses.
“The City always bounces back from downturns, and it is chomping at the bit to bounce back from Brexit, but the farther we go down this hole, the harder the climb back up will be.”
The agency’s London Employment Monitor shows that available jobs decreased by 50% year-on-year and by 33% quarter-on-quarter. Meanwhile, the number of professional job seekers fell by 19% year-on-year and by 22% quarter-on-quarter. However, the number of job seekers rose in May (up 7%) and June (up 5%).
In contrast to the financial services sector in general, fintech is having no problems with recruitment or with visa applications. Morgan McKinley reports that a record number of visas were issued to technology professionals, many of whom would be working in fintech firms.