White Consulting Partners

Market Trends – February 2012
We are living in uncertain times and in some industries like financial services and banking – things have never been more so.

If you look at the hierarchy of an organisation as a symbol – it looks like a pyramid. Flat at the bottom and narrow at the top, depicting the larger amount of jobs you find at the junior levels and contrasting smaller number of positions at the top levels.

In today's market, with increasing uncertainty predicated by a Euro zone crisis and sluggish US economy, Australia whilst in better shape than some of its global cousins is in no way cushioned from the fallout. The cost of borrowing from overseas banks has squeezed profit margins in Australian Banks and as such the flow on effect will be an overall consciousness on cost and cost cutting. As Bank costs are primarily made up of people and technology, we see staffing costs as a key pressure point and lever to drive down.

The large Banks will seek to cut costs by downsizing positions in all levels of the pyramid but particularly the middle and top levels. This is because the salary levels are higher and greater cost savings can be achieved – and the thinking is that someone more junior can step up and do the work. That's in theory anyway. This is leading to staff working longer hours (and probably not complaining because of fear of losing their job **!!). Hence, vacancies are also decreasing. If there is scope for a new hire, position approvals will be harder to get requiring higher levels of sign off and delays to the recruitment process.

However to put some hope and positivity into the equation, we feel that there will still be roles and opportunities in wealth management, superannuation and insurance particularly in compliance areas as organisations embrace regulatory changes. Banks will continue to navigate their way through the capital funding issues and what if/worst case scenarios and this will also create roles and opportunities to build models and processes to manage constraints and demands from regulators.

In summary we expect the job market to be uncertain for the next six months. Hold onto your hat!

For further information, please contact Kate White on Kate@whitecp.com.au