Slump drags city jobs to a nine year low

 
Tim Wallace
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A TOXIC mix of tough regulations and weak market conditions has pushed down the number of finance professionals registered to take the top jobs in the City, the watchdog’s latest numbers show.

Shrinking headcount since the financial crisis, combined with harsher scrutiny of top executives, means businesses need fewer leaders and fewer finance workers want to take those jobs.

Just 149,626 approved persons were active in March 2013, down 4.2 per cent on the year and the lowest level in nine years, according to the final annual report of the Financial Services Authority (FSA).

In March there were 18,473 authorised firms, a number which has fallen in recent years.

Another year of weak trading activity is in part to blame, pushing down firms’ need for senior risk takers like traders.

And financial institutions have been slashing staff in major restructuring programmes over the year – UBS announced a plan to cut 10,000 jobs, while Lloyds passed the halfway mark in its drive to trim 15,000 staff from its books and Barclays has indicated it is considering cutting tens of thousands of staff in the near future.

Industry analysts do not expect the trend to turn around any time soon.

“With trading activity falling, banks looking to restrict their activity in some product classes and to close down some business lines, the numbers of top level individuals like traders has had to shrink,” said Hakan Enver from recruiters Morgan McKinley. “On top of that some high-earners have moved to more tax efficient jurisdictions, particularly to Asian finance centres.”

The regulator has also become tougher in the punishments it dished out in the year.

Although the overall number of fines levied fell from 59 in 2011-12 to 51 in 2012-13, the total value of those rocketed more than 450 per cent to £423.3m from £76.4m, largely on the back of the Libor manipulation fines given to Barclays, UBS and RBS.

Martin Wheatley, the head of the FSA’s replacement the Financial Conduct Authority, plans to get tougher on bad behaviour. The boss has pledged to act more preemptively than the FSA did, intervening in finance firms more quickly if he suspects wrongdoing or bad practice.