Did you know that the financial labour market in the UK alone has contributed over 6.9% to the overall UK economy in the year 2019? With over 1.1 million jobs, the financial sector in the UK had become the 9th largest economy in the OECD. The UK’s financial sector has outsized every other country in numerous ways. This sector has the highest paying jobs to over seven per cent of its working population. With this, we are sure that you are evident on how important the finance sector is to the UK.
Unfortunately, with COVID-19, there has been unprecedented interference in the entire financial market of the UK. But it has been one of those sectors that had stayed stronger with a powerful comeback when compared to others. Thanks to the G20 reforms and the swift digitalisation. Our financial sector was way resilient even before the pandemic.
Scope of finance sector jobs
Employment opportunities in this sector are numerous. From accounting to banking and finance, financial planning to insurance, investments and pensions to tax, and much more, the scope of the finance labour market is exponential.
Best jobs in the finance sector
Here we are listing the Top 10 job titles in the finance sector for you that are in high demand:
In this article, we are going to discuss the impact of COVID-19 on the financial labour market. We are using our all-in-one Talent Market Analytics to represent the following insights. Our tools have helped us put these insights to you clearly. Stay with us till the end for statistical analysis of the complete financial labour market in the UK.
Pandemic has threatened even the top most businesses in the UK. Though the short-term impact was sudden, it was also severe. When the business gets affected, so does the job demands.
Short-term impact on the financial sector
The pandemic has left thousands of people jobless. When people go jobless, their major financial plans and shopping needs get reduced. It had caused a substantial fall in consumer credit.
Medium-term impact on the financial sector
Due to the stalled housing market, the mortgage sales were frozen too. The rising unemployment again caused this as people did not want to put out their savings and expect the economy to bounce. That had a direct impact on the mortgage market.
Long-term impact on the financial sector
The insurance industry will take a long time to recover. Many insurers faced an increase in the claims and lower interest rates caused due to pandemics. Travel insurance is another area affected as travel is nowhere to resume the pre-code era any sooner.
Statistical impact analysis of COVID-19’s impact on the Financial labour market:
The above given are the statistics showing the job postings from January 2020 to June 2021. Just after the pandemic hit the country on January 31 2020, a major plunge in the number of job vacancies can be seen. According to ons.gov.uk, “February to April 2020 saw the largest quarterly decrease to the vacancies total since the current time series started in 2001.” Below here, we have conducted a quarter on quarter analysis. Read on to know more.
Labour Market Overview (Accounting and Finance, Q2 2020)
Let’s begin our analysis from Q2, 2020, the beginning of the pandemic era. It was the period when the crisis had sent the entire nation into despair. The implications of COVID-19 on the finance industry were no different.
From the above graph, you can witness this tight spot with a drastic dip in the number of job vacancies in the financial sector in the second quarter (Q2, 2020), i.e. April to June 2020. The number of vacancies had decreased by approximately -70.5%. (when compared to Q1, 2020).
Market Overview by Agency/Direct
In the second quarter, the market can be seen as highly volatile. With 6K( 52.7%) agency job postings and 7K (47.3%) direct job postings, direct companies can be clearly seen outdoing the agencies.
Labour Market Overview (Accounting and Finance Q3 2020)
In the third quarter (Q3, 2020), i.e., July to September 2020, the number of job vacancies can be seen shooting up by 73.7%. The total number of jobs generated in the financial sector increased from 13K to 24K in Q3 compared to Q2(2020).
Market Overview by Agency/Direct
In Q3, 2020, direct job postings were around 13K (56.6%), and agency job postings were approx. 10K (43.4%). Compared to the second quarter, there seems to be a reverse trend as the job postings from direct companies towered over the agencies.
Labour Market Overview (Accounting and Finance Q4 2020)
In the fourth quarter (Q4, 2020), i.e. from October to December 2020, the total number of jobs generated in the financial sector slowly spiked from 24K to 29K.
Market Overview by Agency/Direct
The fourth quarter follows the same trend as the third quarter wherein the direct companies triumphed over the agencies with 16K (56.3%) and 12K (43.7%) each.
Labour Market Overview (Accounting and Finance Q1 and Q2, 2021)- The progress is evident and stabilised.
The Government’s effort to curb the effects of the Coronavirus pandemic can be evidently seen in the first two quarters of the year 2021. With the increased vaccination drives and easing down of the lockdown restrictions, in 2021, businesses started resuming in full swing, and job market recovery happened rapidly.
According to ons.gov.uk, “In February 2021 to April 2021, the estimated number of vacancies reached its highest level since January 2020 to March 2020 (which is a pre-coronavirus (COVID-19) pandemic period), with growth picking up in the most recent quarterly estimates.”
Regional labour market analysis of financial sector recruitment
To further our analysis, we conducted a regional labour market analysis of financial sector recruitment as well. One can see that the number of vacancies in Q2 2021 is at its highest in the London area with a total share of 20.64%, followed by South West (England) ( 17.76% total share) and South East (England) (12.85% total share).
Financial labour market – The future
Last year, the entire financial infrastructure was put to test. Only the digital-savvy financial companies survived. While others too survived but had to put themselves through predominantly digitised models. This was a vital step as it paved the way for how financial markets will behave in the future. Modernizing data core systems and cashless banking with digital engagement will become imperative.
New steps will be taken to implement FinTech in the sector. Innovating actions will be taken that will allow employees to work from anywhere into the entire financial infrastructure. This means the future of the financial labour market will enable work-from-anywhere solutions seamlessly into each of its aspects.