But be prepared for a cut in pay and loss of City relationships
AS A WEAK economy and regulatory requirements push financial institutions’ cost bases ever higher, many employers are looking to save money by moving jobs to the regions, creating some attractive career opportunities for those willing to look outside of the capital.
The regions already have a thriving financial scene. JP Morgan, for example, is one of Bournemouth’s biggest employers, and retains around 4,000 support staff in a variety of roles. Bank of America runs its European credit card operations out of Chester, and expects to move up to 2,000 back and middle office workers there over the next decade. Citigroup, meanwhile, employs people in technology, operations and project management roles in its Belfast office.
And contrary to popular belief, there’s some good front office opportunities too. Hargreaves Lansdown is headquartered in Bristol. The major accountancy firms all have corporate finance divisions spread around the country, while private equity businesses like Barclays Venture in Coventry, ECI Partners in Manchester and Lloyds Development Capital in offices across the country all need professionals on the front line. Last month, Deutsche Bank emerged as something of a trailblazer, reportedly in negotiations to open a trading floor in Birmingham.
Although it’s more expensive, many companies find it preferable to move jobs to the regions than overseas, given the higher educational standards in the UK and the absence of significant language or cultural barriers, as well as proximity to the head office in the event of an emergency.
Despite the growing number of opportunities available, many City professionals are reluctant to move. In a survey of banking and finance professionals by Astbury Marsden, 86 per cent of respondents said they were open to an international relocation, while just 58 per cent would even consider moving elsewhere in the UK. When broken down by business function, only internal auditors would prioritise a domestic move over an international one.
Guy Emmerson, operations director at Badenoch and Clark, says this prejudice derives from the misconception that the work is second-rate and there are no opportunities for progression. “But this just isn’t true.”
As regional teams tend to be small, you’re often given more responsibility from an earlier stage. At the junior level, it’s unlikely you’ll be pushed into specialising as quickly as you would in London, which can give you more time to work out the area of business and function you’re interested in. At every level of seniority, you’ll often be targeting potential investments or investors over a large geographical area, and across a broad range of products and industries.
Andy Dallas, director at financial recruiter Robert Half, says that, while hiring remains concentrated in London, “we are continuing to see demand from the regions, particularly in risk and change management”. He notes that many of the larger institutions are outsourcing their day-to-day functions outside of the capital to leverage the lower salaries and commercial property costs there.
Emmerson adds that building a solid reputation is much easier in the small, tight-knit teams in the regions compared to the City. The big banks and technology companies, in particular, tend to have university campus-style workplaces, fostering out-of-work team building – Bank of America’s Chester site, for example, sits on 12 acres of land with football and cricket pitches, a basketball court and a softball field.
This means that cultural fit is important, perhaps even more so than in the City. A key part of the interview process will be determining how well your personality will fit in with the rest of the team.
But the ease of building a reputation has to be weighed up against the loss of networking opportunities, which are so commonplace in London. While it is possible to relocate back to the Square Mile, it’s much harder when you’re not meeting potential contacts in the area on a daily basis.
THE PAY ISSUE
If you do move away from the City, be prepared for a significant pay cut. A finance director working in London, for example, can expect to earn somewhere between £100,000 and £250,000 per annum. This drops to £80,000 to £100,000 in Yorkshire and £80,000 to £90,000 in the North West, according to the latest market insight from Marks Sattin.
But broadly speaking, salary gaps tend to narrow with seniority. Emmerson estimates junior professionals working in the regions earn around 30 per cent less than their City counterparts, falling to 15 per cent at the more senior levels.
And the lower cost of living could more than outweigh the downsides of a lower salary. Data from the Office for National Statistics shows that average weekly household expenditure in London between 2009 and 2011 was 22 per cent higher than the national average, compared to 14.6 per cent higher in the South East, 5.7 per cent lower in the North West, 6.4 per cent lower in Scotland, and 18.4 per cent lower in the North East. Throw in a better work-life balance and you could be on to a winner.
Be aware that not all of the regions are growing. The financial services workforce in Manchester – the city with the most staff outside London – stayed flat in 2011 at 49,800 (London, by comparison, employed 663,700). The fastest growers, meanwhile, were Tatton and Exeter, whose respective staff levels of 9,500 and 6,100 rose by a quarter. The biggest cuts hit established centres including Glasgow (14.2 per cent to 37,400), Edinburgh (11.5 per cent to 49,500) and Bristol (10.1 per cent to 32,900).
Despite development efforts, job numbers are still growing at a significantly faster pace in the capital than anywhere else in the UK. A survey by Robert Half found that 40 per cent of finance directors based in London and the South East plan to expand hiring in the first half of 2013, compared to the 28 per cent country average, while employment and productivity levels as measured by the Office for National Statistics are consistently higher in the City. The concentration of labour and clients in the capital means it is still the most profitable place to do business, and there certainly won’t be a mass exodus any time soon.