December saw a decline of 21% in the number of job offers confirmed in the City, according to Powerchex, the pre-employment screening firm.
Compared to November, investment bank opportunities dropped by a massive 65%, whilst insurance firms registered a drop of 17%.
However, other areas of the financial services sector did register increases. Opportunities in investment management increased by 12%, stockbroking by 5% and hedge funds by 1%.
The MD of Powerchex, Alexandra Kelly, said she thought that many companies might have over-hired in 2010 and might now have to adjust staffing levels to meet their business needs.
She also pointed out that it was important to compare these latest figures with those obtained in the past two years. In 2010, financial services companies made 37% more job offers than in the previous year.
Whilst recruitment might have died off in December, the overall picture for the sector is good. IT contractors will be relieved to learn that recent data from the CBI shows that activity in the financial services sector continued its increase in quarter four last year.
Half of the CBI survey’s respondents reported an increase in business volumes, whilst 27% reported no change. However, the CBI expects to see a slight dip in activity levels in the first quarter of 2011.
The director-general designate of the Confederation, John Cridland, pointed out that the financial services sector produced strong growth in the second half of last year but businesses expect it to slow down this quarter with only a reasonably modest increase in profitability.
He also noted that there were variations across the sub-sectors of the industry. Banks are expecting to see subdued business volumes but investment managers and securities traders are doing much better and are still recruiting more staff.
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