Strategies for Addressing Recruitment Challenges in the Financial Sector
The financial sector is one of many that is struggling with staff numbers and recruitment following the coronavirus pandemic. Digital transformation is revolutionising a number of day-to-day tasks within the financial industry, changing the nature of the job. With applicants falling and vacancies rising, why is this a problem and what can be done to overcome it?
A Settled Workforce Brings Stability
Of course, it is not just the financial sector that has seen recruitment problems in recent times, but there are also a number of risks to companies in this sector that an unsettled workforce can cause. Firstly, there are various reasons why it benefits an organisation to have a settled, consistent workforce:
- Financial savings on recruitment and training – a settled workforce is one that has a lower staff turnover, representing a financial saving through minimised disruption of finding new staff. The longer an employee has been at a company, the better understanding they have of the role and of the organisation and their values.
- Staff can focus on their own job – with staff turnover low employees can focus on the tasks that make up their job description and their day-to-day role. This increases employee understanding of their role and the contributions they’re expected to make, creating a more focused workforce. Staff will also generally be less busy and won’t feel overworked as they are not spending time covering for others. Naturally there will be times when individuals help with jobs that aren’t their bread and butter, but a consistent workforce removes the need for long-term cover being required.
- Better customer service – as noted, the longer the employee has been in the job, the more they understand the role and the company. This also affects customers, with relation to a higher level of expertise with longer-serving employees, for problem-solving and dealing with any issues.
The above points stand for most business sectors, but in the financial sector, it is very important to overcome recruitment issues that are resulting in unsettled workforces. A stressful industry to work in, the financial sector can be particularly challenging at the best of times, let alone when businesses and workforces are stretched beyond their means. In fact, since 62% of finance-sector companies reported an increase in mental health-related illnesses in 2018, the number has increased further. With this in mind, what are the barriers to recruitment that the industry is seeing?
While this has been a benefit to many organisations in recent years, it has also created some issues. Remote working has been in operation for a number of years of course, but the covid pandemic really escalated it, and most organisations had no option but to work away from offices. While this allowed many companies to continue working and at times result in better performance, it can also pose recruitment issues. It has removed the geographical to some extent, meaning that employees in the financial sector have more applicants to choose from in their roles. Companies which would have previously recruited from a localised talent pool were now able to work anywhere and everywhere through remote working. Yes, this is less of an issue for those companies that have also adapted to this way of working, but for organisations requiring traditional officed-based work, they will potentially see a reduced number of applicants. In relation to how important at least hybrid working is, at least 70% of employees expect their employer to shift to this way of working.
A Smaller Talent Pool
As technology increasingly impacts the financial sector, many job roles now require different skill sets than they previously did. This, coupled with the unique skills required in banking and finance anyway, means that recruiting can be a challenge. In fact, niche technical areas including machine learning are seeing a shortage in suitable candidates. In a unique challenge for the financial sector, they are seeing employees have an ‘upper hand’ in recruitment, and post-pandemic challenges mean they now are also grappling with a smaller talent pool while introducing a modern way of working that they may not have considered. The challenges as we have seen will have an impact, but what can be done to help?
Outsourcing is not a new concept. For years, companies have outsourced elements of their business operations and customer service outsourcing is something that is commonplace. Outsourcing can fill gaps in a workforce should there be difficulties either in recruitment or staff retention. As it is flexible, outsourcing can allow operations to continue when the business may otherwise be sleeping. There is the option to operate in different time zones or use technology and AI to automate processes around the clock. Like everything, it is not a one-stop shop, and there are considerations on the uses of outsourcing that will vary from business to business. It is, however, a definitive solution to overcoming a multitude of recruitment issues. In addition, it will reduce the workload of current employees, particularly with the need to cover in areas that aren’t part of their day job, allowing them to focus on their primary role.
Training and Promoting Within
Training can be time-consuming, but it provides a solution for companies struggling to attract new talent. Training up existing employees and promoting them to fill vacancies, although it can create other vacancies in the business, may be an easier transition for your business. Promoting from within also incentivises employees and gives them something to strive towards; another way to keep employees invested in the organisation.
Focus on Employee Welfare
We are looking a lot at the struggles of recruitment. However, businesses can address the issue before recruiting is necessary. With stressful environments and the impact of poor mental health, as well as the need for a strong skillset, employers should put their workforce at the top of their list. Incentives, including financial rewards, can help retain employees by creating a feeling of appreciation and value within the workforce. Where possible, businesses should use flexible working models to encourage a good work-life balance. In addition, discounted gym memberships and incentives to boost morale such as a ‘birthday day off’ can make employees feel valued and reduce the risk of high staff turnover rates. Financial rewards and bonus schemes are great, but in the fast-paced and often stressful financial sector, the wellbeing of employees must be a focus.
No matter which option you choose, we live in a world where customers want and expect the best right now. If you aren’t providing the best service, the customer will not wait for you, whether it be because of headcount or an unsettled workforce. Being indecisive or taking no action to address recruitment and workforce issues could cause a loss in business which may well last years into the future.
London financial vacancies continue post-pandemic climb – survey – Reuters
Importance of Consistency in the Workplace | Woman – The Nest
Top 5 Recruiting Challenges for the Finance Industry (sparksgroupinc.com)
Banking and capital markets outlook (deloitte.com)