Graduate recruitment in financial services is set to rise by 42 per cent this summer, according to the annual Pay and Progression for Graduates report by Thomson Reuters Income Data Services.
The employment research and information firm found financial services firms are planning to hire more graduates than they did in 2013, when recruitment in the sector fell by 3 per cent. But does the experience of specialist financial services recruitment firms bear this out?
Coast Specialist Recruitment executive consultant Karen Halliday is hearing that job prospects are brighter for graduates than they were last year. She says many of the bigger financial services companies provide their own graduate trainee schemes, which graduates apply for directly.
“We are seeing that where jobs cannot be filled – which could be in IFA support or financial services administration – companies will consider graduates who are looking to carve out careers in financial services,” she says.
Given that employers will lower their expectations in taking on graduates instead of the “finished article”, graduates will also lower their salary expectations.
The IDS report found most employers across all sectors have not increased graduate starting salaries. But the financial services sector was found to offer the highest average salary last year at £26,500, just behind the legal profession at £35,000.
Halliday says: “Salaries are good on the whole. But where graduates would have held out for annual salaries of £30,000 to £35,000, six months into a job hunt they lower their expectations, so companies can find graduates for less.”
Keillar Resourcing managing director Harris Keillar has recently started working with a client that considers hiring graduates. He says: “I am astounded at the number of really well-qualified graduates with good degrees and good language skills who are working in shops or are on short-term contract work.
“There are a huge number of graduates so there are loads of people for companies to choose from. Costs have also been driven down by things like the RDR, so there is not as much money in the system to pay for graduate salaries,” he says.
Keillar reports anecdotal evidence that job prospects in financial services are improving for graduates. “A friend who works for one of the big banks was taken on about 15 years ago and says there has hardly been any graduate recruitment since. But this year they are starting to look at graduates again.”
Keillar is also hearing that firms are looking a stage further down the chain in search of young recruits. “A lot of companies have not had graduate recruitment for a long time and are now looking at school leavers who are bright but who do not want to go to university because of the cost of the fees,” he says.
James Associates director Richard Bailey says many of his clients are smaller firms which lack the infrastructure to offer graduate training plans, so they prefer to hire people with relevant experience.
“We have probably placed about two graduates a year but they tend to be those who have a financial services degree in financial planning or they have some professional exams, while others may have a business management degree,” he says.
If small companies seek a particular type of candidate but cannot find anyone suitable, Bailey says they may take on a graduate with a minimum 2:1 degree and some experience. “The situation probably is better than it was for graduates but they still have to prepare themselves by gearing their education to the job or gaining relevant experience,” he says.
Adviser View: Scott Gallacher, director, Rowley Turton
We have never had a specific graduate recruitment policy but have ended up with graduates because more people are going to university. We have taken on an admin assistant who is a graduate but it is not a graduate role. A major problem is there are a lot of graduates. A lot of people have gone to university but this has not necessarily raised standards and there has not been an increase in graduate jobs – I do not mean in financial services but in other professions.