Skills shortages drive up finance sector salaries

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Salaries for top tier professionals in the UK financial services have risen due to skills shortages in the sector, a survey has found.

Companies are paying a premium for talented staff, with salaries for some positions in risk and compliance increasing by 8.9% over 2013, according to the 2014 Robert Half Financial Services Salary Guide.

An imbalance has emerged between staff with long tenures at organisations whose remuneration has not kept pace with some of their colleagues, leading companies to fear reduced levels of retention, the report suggests.

Nearly all (99%) of the firms surveyed said that it is challenging to find skilled financial services professionals, and 95% of boardroom-level executives are concerned about losing top performers – a 28 percentage point increase on last year. Ninety-three per cent are also alarmed about losing staff affected by the European Union bonus cap to international opportunities.

This comes as the number of new jobs in the financial services sector increased by two thirds since December, according to separate research.

City recruiter Astbury Marsden reported the creation of 1,340 City jobs in December and 67% increase on the previous December.

Banks’ profits are starting to return, but the increase in regulatory requirements is also driving the salary increases, Robert Half’s research suggested. Skills shortages are emerging in financial regulation, specifically anti-money laundering requirements, disclosure and reporting requirements.

“It’s been a period of seismic change for the financial services industry,” said Phil Sheridan, managing director, Robert Half UK. “Firms have had to re-evaluate their business models, bolster capital and find new areas for growth, all under the watchful eye of both the regulators and the public-at-large.

“This evolution creates opportunities for firms to change public opinion while also pursuing growth and for talented financial services professionals to make a valued contribution. Regulatory demands continue to evolve, increasing workloads and forcing firms to balance compliance with the pursuit of growth strategies.”