What Will Affect Hiring in the Financial Industry?
As the economy continues to recover, financial services companies everywhere face new challenges when it comes to workforce hiring. Aerotek's Financial Workforce Outlook 2014 sheds some light on the future of this sector as it continues to evolve.
Figures from the Bureau of Labor Statistics project that in the next ten years, the finance and insurance sector may grow by as many as three-quarters of a million positions, reaching a new overall total of 8.5 million employees. Despite this high level of projected growth, there are still challenges in the market that need to be overcome. As financial services and related businesses continue to work on re-growing and navigating the increasing regulations in their modern business climate, they will require top-quality talent, including everything from entry-level customer service positions to the full executive level to better lead the way.
In recent years, the financial industry as a whole has seen a number of operational changes. Most of them were put into place in the aftermath of the recession to streamline business operations, cut costs and meet consumer demands. Many of these changes were centralized to the call center, the shared service center and the processing center sectors. With that trend continuing to improve, staffing needs will change alongside it.
Another prominent trend will be in the rapid growth of shared service centers. These locations reduce costs by consolidating multiple back-office operations into a shared operation if they're used by multiple divisions of a company. Of interviewed companies, Deloitte found that nearly 82 percent expect the number of transactional processes to increase the use of service centers. More than three-quarters of internal business units will be migrated to these services, with 66 percent of geographic regions being served by service centers and 61 percent of advisory processes being implemented in the centers. Financial services companies will see 37 percent of their functionalities put into these aspects of the industry, with it seeing the largest increase out of all possible industries.
Growing government regulations
Yet another factor still needing to be considered is the potential rise of government regulations and compliance. In response to the financial crisis from 2007 to 2008, the federal government has levied a number of tighter regulations on U.S. financial institutions. One of the best examples of these is the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, and as most financial organizations have been impacted by these services, some banks have begun to merge or shift many of their implementations.
A major shift has come from the increase in compliance employees to better meet the guidelines put into place by the government. For instance, a report indicated that one bank expanded its compliance team from five to 35 employees over the course of four years, with some employees expected to be specifically responsible for Dodd-Frank compliance. Other companies have seen an increased demand for financial examiners, a subsection of the industry that includes compliance officers.
For more information on future changes in the industry, consult the Aerotek Financial Workforce Outlook 2014.