City of London Financial Services Job Vacancies Plunge

Financial services job openings took a sharp tumble in July, as the number of individuals actively searching for work in the sector shot up.

According to recruiter Morgan McKinley's London Employment Monitor, July saw a 37% annual fall in job availability to 11,277. On the month there was a 9% drop to 7,056.

However, the number of professionals crowding the market for a financial services job was up by 63% on the year before.

"While it is disappointing to see a drop in hiring levels after the gradual rises recorded in May and June, the seasonal effect of the holiday period cannot be underestimated," said Hakan Enver, operations director at Morgan McKinley Financial Services.

"It is not unusual for hiring processes to stall somewhat during July and August and we would expect to see vacancy levels recover again in September."

Extra regulatory requirements in the aftermath of the financial crisis have helped prop up the financial services job market, as big institutions hire staff to help them comply with new and evolving rules.

"As regulatory pressures on financial institutions intensify, there are also a number of major change programmes underway calling for experienced project change specialists around Basel III, Dodd Frank and EMIR - and with MIFID2 in the pipeline this is a trend likely to continue for at least the next 18 months," said Morgan McKinley's Enver.

The London Employment Monitor also found that the salaries on new jobs had risen by 17% on the month before, far ahead of the UK average 1% wage rises recorded by the Office for National Statistics (ONS).

A survey of financial sector firms by the Confederation of British Industry (CBI) and business services giant PwC showed that confidence is building and a modest recovery in staffing levels is expected over the second half of 2013.

The report said that drivers of recruitment "vary considerably between sub-sectors".

"For investment managers, entering new markets is the leading motivation for hiring; among insurers, a change of strategy is seen as more important," it said.

"Banks' and building societies' hiring plans are largely shaped by the requirements of regulation."

Signs that the global economy is starting to pick up again will also bolster staffing levels at financial firms.