To stay relevant and competitive, investment banks have adapted new hiring practices in the technology-dominated, post-COVID world. These hiring trends were visible across financial institutions. While in the previous calendar year institutes were worried about staffing and labour shortage, banks were predicting a long struggle for employees to continue to post the COVID-19 pandemic, according to the American Banker. Let’s see how the hiring trends are predicted to be in 2023.
2023 – Back to ‘Normal’
Employees were instructed in 2021 to strictly comply with Covid guidelines. Many were told that if they weren’t vaccinated, they would lose their jobs or get lower pay. Global financial institutions like Citigroup and JPMorgan laid out a clear Covid mandate and required COVID-19 vaccinations for employees to return to the office.
Since then things have changed. 2023 seems like a ‘back to normal’ year, and banks are indicating fresh hiring. Investment banks such as Goldman Sachs and Morgan Stanley have dropped their mandates for Covid vaccination and loosened other restrictions. Many other financial institutions have followed the same trend while easing Covid-related restrictions.
High Demand for Accounting and Finance Professionals
Accounting and finance jobs along with other middle office roles performed the best and showcased high demand. This, perhaps, suggests that banks expect their added infrastructure to prove useful in the near future. There is also a concerning fact behind this strong demand. The average age of a financial advisor is 55, and 20%, or 1 in 5 financial advisors, is over 65. This suggests that in less than a decade, over 100,000 of those advisors will retire, accounting for over one-third of the industry workforce. To stay ahead of the problem, banks are changing their hiring and retention strategies and therefore, this trend might only be a cyclical catch-up to avoid future struggles.
Rising number of applicants
According to a study conducted by EFinancialcareers, in London, there is a large rise in the number of job applicants, across the financial sector. As a general trend, for the top 10 job categories, companies have received close to nine applicants for each role, which was previously around six applicants. This is a 50% increase. Competition is rising in investment banking as well. This trend, however, might be limited to London or could be a result of mass layoffs done after the Covid pandemic.
A slowdown in remote jobs
Financial institutions witnessed a large rise in remote jobs in 2021 and 2022. From 4% in 2019 to nearly 12% in 2022, the share of jobs explicitly stating remote working nearly tripled from the pre-pandemic levels, according to ZipRecruiter data,
According to a study conducted by LinkedIn, in 2023, the number and share of remote jobs in the overall job market will stagnate or decline, as employers prefer their staff in the office. The study showed that the trend is already underway. On the other hand, remote working is becoming increasingly popular among employees and job seekers. This was evident from the rise in demand for remote jobs from job seekers.
While current technology allows people to work from anywhere in the world, CEOs from top global investment banks have previously expressed their concerns about remote working due to issues like insider trading, leaking of information, etc. Investment banks have spent millions of dollars in upgrading their infrastructure to make it Covid compliant. This could create a mismatch between demand and supply in the near future.
Promoting Internships
Investment banks have been at the forefront of employing interns, recruiting good talent and introducing fresh graduates to the required work culture. Goldman Sachs and other top investment banks are promoting investment banking internships and encouraging participation by women and minorities historically underrepresented in the industry.
Conclusion
Investment banking hiring trends are constantly changing, so you must also adapt accordingly. Major hiring trends to look forward to in 2023 are:
- A slowdown in remote working
- Rising competition in terms of number of applicants per job role
- A rise in investment banking internships
- A rise in PE jobs
- Increasing use of AI and ML in investment banking
By following the trends and making the necessary changes, you can increase your chances of getting a job. To check out for more details on hiring trends you can also read LinkedIn learning reports.
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