Vickers reforms will worsen the effect of financial jobs slump on the UK economy

Elizabeth Fournier
UNCERTAINTY over how structural changes proposed in the ICB report should be implemented will leave banks reluctant to hire, adding to the drag that the financial sector is having on UK job creation.

After a upturn in banks hiring six months ago, optimism is the sector is now way down, according to the latest employment outlook survey from recruiter Manpower.

After a strong performance in the past two quarters when the outlooks for financial and business hiring were +16 per cent and +10 per cent respectively, the sector has suffered a setback this quarter, with the outlook falling sharply to +6 per cent.

“Six months ago it looked like the banks were going to lead the way out of the recession,” said Manpower’s UK managing director Mark Cahill. “But this has now fallen away quite dramatically over the summer.”

Though the overall hiring trend in the UK remains narrowly positive at +2 per cent, the slowdown in the banking sector has hit the outlook, which fell for the first time since 2009. And with Vickers’ recommendations set to hit profits at the UK’s biggest banking employers, investment in headcount is unlikely to be a top priority.

“The decline in employment prospects could be compounded by the Vickers report,” said Manpower director James Hick. “It will send yet more negative vibes through the banking sector.”