The hiring process is a living system. It should be periodically reviewed and updated to remain current with job climates and candidate expectations. When this step in the process is not performed, the process as a whole begins to breakdown. Investing into the time needed to evaluate and improve the hiring process is more efficient than a “bad” hire.
𝘾𝙇𝙄𝘾𝙆 𝙏𝙃𝙀 𝙇𝙄𝙉𝙆 𝘼𝘽𝙊𝙑𝙀 𝙏𝙊 𝙎𝙐𝘽𝙎𝘾𝙍𝙄𝘽𝙀, 𝙍𝙀𝘾𝙀𝙄𝙑𝙀 𝙏𝙃𝙄𝙎 𝘼𝙍𝙏𝙄𝘾𝙇𝙀 𝙄𝙉 𝙔𝙊𝙐𝙍 𝙄𝙉𝘽𝙊𝙓 𝘼𝙉𝘿 𝙍𝙀𝙁𝙄𝙉𝙀 𝙔𝙊𝙐𝙍 𝘽𝙐𝙎𝙄𝙉𝙀𝙎𝙎. 𝙔𝙊𝙐 𝘾𝘼𝙉 𝙐𝙉𝙎𝙐𝘽𝙎𝘾𝙍𝙄𝘽𝙀 𝘼𝙏 𝘼𝙉𝙔 𝙏𝙄𝙈𝙀.
The quote is from a transcript of a speech given by Andrew Haldane (Chief Economist at the BofE) last month in Port Talbot, Wales. Whilst the main topic of the speech is very much about monetary policy and measurements of wealth / well being in the UK, the above quote echo’s what I think the City has been feeling since Brexit… Are companies’ indefinitely holding off making “lumpy decisions”?
The full report: http://www.bankofengland.co.uk/publications/Documents/speeches/2016/speech916.pdf
In a recent article by Compliancy Services according to the Chairman of the UK Treasury Committee, smaller banks could benefit from post-Brexit regulations…
Discussing challenger banks, Andrew Tyrie cities that the chance of easing regulation away from the current “one size fits all” approach to Banking regs by the EU, could benefit small banks
In other positive news for small banks – The UK’s recently appointed head of BofE supervision, Sam Woods of the Treasury Select Committee confirmed he is committed to serving the needs of challenger banks.
The full articel can be found here. http://www.compliancy-services.co.uk/news/article/4644/smaller-banks-could-benefit-from-post-brexit-regulations-easing=newsletter?utm_source=&utm_medium=email&utm_campaign=august16-1-jr
Accessing EU talent after Brexit
The Immigration Act 2016 imposes a charge on immigration skills due to be introduced in April 2017, but could now be brought forward following the result of Brexit.
Without exemptions for EU nationals free movement, UK companies will need to use the points based Tier 2 system of sponsorship to recruit from the EU. Any one in HR ops who has supported tier two visas knows that there is a cost and risk associated with it. Analysis from law firm Simpson Millar shows that the total cost for recruiting workers from overseas might actually hit £3,000 or more.
Mariano Mamertino, an economist at one of the UK’s largest job boards Indeed, sums up “June’s official unemployment figures showed the jobless total reducing slightly, but the UK economy’s rate of job creation is fragile at best. In the longer term, crucial decisions will need to be made about what sort of labour market we want in Britain. UK employers have benefitted from the ability to recruit talent from overseas, and many Britons have seized the opportunity to live and work in other EU countries.”
It’s unlikely the door will close on the English Channel, the free movement of workers has obvious economic benefits. British businesses will need to be able to access the talent required to fill vacancies and Europe has been a big part of that source of talent.
European Outflow – gauging intention
In June this year there were 2400 searches on google for ‘permanent uk residency’ – up 5 x on May and almost 10 x on April. The upsurge in leaving the UK over recent months is not dissimilar. Despite Increasing interest in people looking to gain UK permanent residency status and preparing for a move out of Britain, I’m surprised that these search figures aren’t higher considering the ONS reports that there are 3.3M EU citizens in the UK.
Brexit to Frexit – will EU nationals move?
Talking to a senior professional Auditor based in the city, she points out that “the City’s infrastructure to support banking staff compared to other locations is immense. The city has got a lot going for it, over and above Ireland or Paris. I certainly don’t want to move, I moved to London because that’s where I want my job and my social life.”
Whilst Britain has been consumed by Brexit if we turn our eyes to the rest of Europe, the political and economic landscape for some is also uncertain – Italy are in the midst of a banking crisis and a call to exit the Euro (not Europe), a French election coming up in 2017 where the potential of Frexit is already being discussed.
From an investors perspective it is certain that political risk will be a bigger factor in investment decisions than it has been in previous years and Britain isn’t the only European city presenting political risk. Considering that US multinational corporations make up a large part of London’s capital market investors and if today’s Cable rates are maintained, it could be that London keeps its status as the European capital of secondary market trading.
London has a large sustainable supporting infrastructure with an immense amount of talent possessing a forward thinking outlook. After all, London’s providence as the European financial services capital enabled it to become the centre of Chinese renminbi trading despite Brexit woes.
You can bet that city lobbyists will be working overtime to maintain London’s status as a Global and European financial services hub and to maintain its plethora of European bankers.
Stephen Gandel reported on Fortune.com that before Brexit there were 40,000-jobs at risk.
Financial Services firms have already started re-locating jobs (mainly euroclear) to Dublin as part of their post Brexit plans. BUT despite the early fears no head office functions have moved.
What the Banks have been saying…
Martin Arnold and Laura Noonan reported in the London FT, that Jamie Dimon, JPMorgan chief executive, warned that 4,000 jobs of its 16,000 in the UK could be moved out of the UK. CEO Jamie Dimon lowered that figure, saying the bank is likely to take at least 1,000 jobs out of London, though the bank is committed to keeping a large staff in the city”. Daniel Pinto — whose IB unit employs most of the 6,000 staff in Britain — also said he hoped to keep most of its UK investment bank intact. The bank would “need to figure out a way to deal with” some specific products and services, such as global custody and corporate deposits, but he said any moves would be gradual.
It has been reported pre Brexit that Morgan Stanley may relocate as many as 2000. There’s speculation in the press around this figure.
The Financial Times reported HSBC have reiterated that it would “keep its headquarters in the city, a decision that the bank arrived at after a 10-month review ending in February.” However whilst HQ will stay put it seems some roles would be affected…. Amber Choudhury at Bloomberg reported “Stuart Gulliver of HSBC Holdings Plc has said the lender would likely need to move 1,000 investment bankers to Paris because they’re linked to operations governed by MiFID II”
The BBC quoted Barclays CEO Jes Staley as saying that the bank is “staying anchored in Great Britain.”
Financial Services firms have been downsizing before Brexit. Cutting jobs and Offshoring jobs to Asia, Africa and Eastern Europe. Only last year Deutsche CEO John Cryan reported in the FT that he would withdraw from 10 countries and cut 9,000 jobs as part of an overhaul designed to restore profits….Lloyds boss Antonio Horta-Osorio has moved 7300 jobs and has another 1800 to go.
Relocating jobs – whats the impact on Audit?
Off to sunny Madrid?…
Auditors who think a move to Madrid, Dublin or Frankfurt (for the record, some passporting and trading licences are already in place in Frankfurt at some banks), could be disappointed as salaries will align to the local market. So a senior VP on a £120k salary is not likely to attract anything near that elsewhere in Europe, but then the cost of living and other outgoings are lower.
Some reports have gone as far to say VP’s should expect to lose as much as half of their salary if their role is relocated. However I don’t see this analysis applying to the Senior Auditor as it doesn’t take into account the premium required to attract those with the rare skills and knowledge of complex markets that the UK FS Auditor possesses. Infact Audit, Legal, Controls & Risk staff could be in high demand to help manage change during Brexit.
Research from consultancy Synechron concludes that it costs an average of £50k per employee in relocation costs to move employees to either Amsterdam, Frankfurt, Paris or Dublin.
Relocating roles doesn’t present the cost saving you might expect, certainly in the short term.
One senior individual I spoke to is not expecting to relocate but has seen an increase in travel to local branches and an increase in regional hiring within overseas offices at junior levels. He expects “no significant changes until there is more clarity around passporting” [see – Brexit internal audit job market within financial]. Furthermore, “a limited amount of roles around operations and functions are expected to move ” but this is just another symptom of the cost savings that banks have been going through. Brexit is just one more difficulty to deal with as [my employer] seeks to save costs by offshoring. Change always creates work for governance and controls. It’s just more of the same with Brexit”.