The financial sector is currently experiencing high staff shortages and attrition following the COVID-19 pandemic. According to the most recent statistics from the recruitment technology provider Broadbean, the number of professionals applying for new jobs fell 37% between February 2021 and February 2022, while vacancies spiked by 52%.
Recruitment problems affect other industries, including Sales and Marketing, IT, and Legal professions. However, for the financial services industry, in particular, the so-called “Great Resignation” recruitment challenges are arguably more complex. Digitisation is rapidly transforming the day-to-day operations, and subsequently, candidate requirements within banking and finance companies are also evolving to favour digitally-savvy candidates.
Additionally, thanks to the impact of pandemic shutdowns and restrictions on travel, the number of people working from home is increasing. More existing financial services professionals are seeking positions that include work-from-home options and a better work/life balance, as many people have adapted their lifestyles permanently in the face of public health risks. Therefore, businesses that cannot or will not offer flexible working conditions to staff could be losing out to competitors who do provide better work/life balance perks.
To cope with these recruitment problems, business leaders need to develop strategies that will help them attract and retain talent, and address skills gaps while they search for the best people. This article will explore how companies can ensure that they’re delivering high-quality services — no matter where they are in their recruitment process.
The importance of a consistent workforce
Employing and retaining highly skilled staff is crucial to building and future-proofing a business. If an employer cannot maintain consistent employee numbers to meet their longer-term needs, their institution will face obstacles. For example:
- Falls in employee productivity — Remaining staff may have to cover the workload of former colleagues until a replacement is found.
- Wasted time and costs in hiring new talent — Studies show that replacing even entry-level employees costs around 40% of their salary, covering expenses such as advertising, training etc.
- Low employee morale – 51% of people say that they are psychologically unattached to their work.
- Poorer customer experience — The lower the tenure, the less experience they have in solving issues.
However, hiring issues in the finance and banking industries are uniquely complex. Continue reading to find out why.
Recruitment problems in the financial industry
The most sought-after candidates in the finance industry have experience in both financial services and technology. However, many institutions are struggling to find candidates with enough talent in both sectors to push their brands forward.
The stress of dealing with money problems means they’re inextricably linked to mental health issues. It’s important for financial institutions to consider the person behind the finances when providing assistance. Human connection is essential when people feel vulnerable as it can help them feel less isolated and provide a path forward.
Business leaders in this industry need to consider the following to overcome their unique onboarding challenges carefully.
1. Increased worldwide recruitment competition
Traditionally, location has limited people’s choice of occupation. However, the pandemic caused a mass restructuring of the traditional working model, meaning many previously office-based roles are now remote.
Location is no longer a factor when applying to remote positions, so people looking for employment can technically choose jobs anywhere in the world.
For many traditional businesses, tying office workers to a set location limits the number of applications they receive and therefore harms their recruitment. Recent studies have shown that 80% of full-time workers expected to work from home at least three times per week after COVID-19 restrictions were lifted. This response indicates that most jobseekers’ expectations have changed dramatically over the last two years. Many people are now seeking remote roles with higher pay or more benefits than businesses located close to home.
2. Skill shortages
Companies with better training programmes have 53% lower attrition. But despite the apparent benefit of upskilling experienced employees, four in ten financial services executives say that their workforce is not currently ready to retrain workers.
The same study also found that business leaders are not keen to open new roles and face ongoing recruitment problems. These figures indicate that many companies face severe skills shortages, impending their ability to innovate, advertise effectively, and meet financial KPIs.
Overcoming recruitment problems
Suppose a shocking 69% of employers find it challenging to fill job positions. In that case, businesses must attempt to mitigate the recruitment crisis before there are severe economic consequences –– such as cybersecurity threats, or a breakdown of operations, putting millions of people’s finances at risk.
Let’s take a look at three possible solutions for speeding up the process of taking on new hires and maintaining smooth business operations.
1. Focus on employee benefits.
Financial services companies can improve their existing employee benefit packages in a bid to boost their employee retention levels.
For example, financial firms can build a positive company culture by offering additional holiday benefits or services that boost employee morale, such as gym membership deals, or an office allowance for new equipment.
To beat their competition in attracting new hires, offering remote working options could be wise for recruiters. Even a couple of days a week working remotely can help lower a potential employee’s commuting costs and make a job advert seem more appealing.
2. Upskill other employees
If a company is struggling to recruit for positions requiring additional or high-level skills, it may consider training existing employees to fill those roles.
Upskilling staff reduces recruitment problems and ensures someone fills the position with a solid understanding of the company’s way of working. Training staff also boosts company morale and builds a positive culture of helping employees advance their careers.
However, the training process can be time-consuming — studies show that a training session of 20 minutes can take up to 79 hours to design. Introducing new employee skills via outsourcing may be more advantageous.
Outsourcing can be a cost-effective and efficient way to fill skill gaps in a business. An outsourcing provider will take ownership of the design and execution of the entire recruitment process, opening the opportunity to recruit multiple roles, at different levels and across different locations.
There is an abundance of finance professionals in the global talent pool. In many instances, HR teams can find people who work across multiple time zones, effectively allowing a company to operate 24/7.
To get the most out of outsourcing, look for FCA-approved service providers qualified to offer financial advice. South Africa, for example, has many financial services professionals who are up-to-speed on worldwide financial regulations and can help make sure financial institutions stay compliant while they find the permanent staff they need to grow.