Scottish finance sector expects drop in job losses

The Scottish finance industry is feeling upbeat and expects to see a fall in redundancies this year with many firms looking to take more people on.

According to a survey 68 financial institutions, employing more than 17,000 people in Scotland between them, more than 40% of the firms that responded had cut staff numbers last year and 10% expected to make further cuts this year, but more than half said they intend to hire staff.  This time last year the same survey – carried out by recruitment firm Joslin Rowe – reported that job vacancies  down more than 90% on the previous year.

The majority of firms (73%) described their company's level of business confidence for 2010 as 'optimistic' or 'very optimistic' whilst 24% had neutral feelings about the future.  Importantly, just 3% were pessimistic (compared with 19% pre-credit crunch).

But there is some stagnancy in the market with individual employees wary of making the wrong career move at the wrong time while some 13% of respondents felt their employer brand had suffered since the credit crunch, making it harder to attract staff.  "People are adopting a 'better the devil you know' career plan through fear of a double dip recession,” commented Margaret Dyer, director of Joslin Rowe Scotland.  "Whilst there's no doubt that there are now far more job opportunities in the market as we head into 2010, job seeker movement amongst talented professionals remains muted.  The recession hangover means even firms with strong employer brands are struggling to entice the best recruits from their competitors."

This could have a bad knock on effect on many firms as nearly half of responding companies (47%) said their current staffing levels are too lean to manage a significant upturn in 2010.  "Regardless of the short term impacts of the current economic conditions, the industry requires a dynamic and skilled workforce that can support the transition currently taking place within the industry and ensure Scotland is well placed to capitalise on new opportunities when they emerge,” said Jim Watson, senior director, Financial Services, Scottish Enterprise.

Scottish Enterprise is keen to stimulate the financial services economy in the country and is undertaking a number of initiatives to ensure that this happens.  “The newly formed financial services Skills Gateway is an excellent example of the type of initiative that we all need to support if we are to develop this highly skilled workforce for the future,” said Watson. “This type of collaborative approach is vital if we are to ensure Scotland can retain its international stature as one of the leading financial services locations in the world."