London City jobs were on the rebound but then COVID-19 hit
Morgan McKinley’s Q1 Spring London Employment Monitor details City hiring trends from January through March 2020. The beginning of 2020 saw the country — after a forceful vote in favour of the government’s decisive Brexit action — finally climb out of the Brexit trenches and begin to look toward the future.
As a result, market optimism made a welcome comeback reflected in a 97% month-on-month increase in jobs available in January. Those job numbers held steady through February, only to have the COVID-19 pandemic bring hiring to a brief pause in mid-March when the deadly virus slammed British shores. In all, jobs dropped by 38%, month-on-month, in March.
Similarly, job seekers kicked off the new year enthusiastically with an increase of 21% month-on-month, levelling off through February. However, the pandemic did not slow professionals down. On the contrary, job seekers continued their job searches through March, as demonstrated by a 7% month-on-month increase from February.
Hot on the heels of pandemic panic loom fears of a global recession. The duration of the crisis will determine the full scope of impact on City jobs, and though it is causing businesses to hit the pause button on new projects, the financial services industry is well positioned to weather the next few months. This is due largely to the UK Coronavirus Job Retention Scheme designed to help businesses pay staff through the worst of the pandemic, as well as the industry’s swift pivot to remote working options.
Hakan Enver, managing director, Morgan McKinley UK commented:
“Out of the frying pan and into the fire: we barely got to take a breath between Brexit and this new global crisis. London came back in the new year, with a renewed optimism, which was reflective in the general mood of employees and employers alike. Soon enough, business confidence fell once again which has in turn impacted trading prospects and overall economic optimism. Thankfully, City employers are doing all they can to enable remote working to ensure the safety of employees as well as business continuity.”
“Numerous banks have pledged not to cut any jobs in 2020 and employers are honouring job offers that were already made. This is a strong sign from major institutions that by working collectively, they can do their part to fend off similar dire circumstances that the UK faced after its decision to exit the EU. However, projects are being paused which is inevitably slowing hiring. Once the initial shock wears off we will see jobs begin to trickle back through.”
“The Coronavirus Job Retention Scheme will go a long way toward ensuring that as few employees and employers as possible fall through the cracks during this difficult time. It’s critical that the government and business continue to work together, with the country uniting to tackle this common threat.
“Institutions continue to recruit business critical vacancies, whilst at the same time, ramping up their remote team systems and practice. This means that those working in IT and fintech are going to continue to enjoy a robust job market. Software engineers, IT auditors, cyber security experts and data and analytics professionals will continue to be in demand, clients being prepared to conduct telephone / video conferences and online tests to determine if they are to be future colleagues. All onboarding is completed remotely, with the new employees starting work from home, with the necessary equipment being couriered to them. Positions outside of these verticals continue to progress, but at a slower pace. In some instances, the final interview being put on hold until staff are able to return to the office and a final face to face meeting then be conducted.”
“Despite all the above, if the global pandemic results in a global recession, then we will feel the consequences of this moment for some time. That’s why right now it’s all hands on deck to avoid a health calamity that precipitates an economic one.”
Average Salary Change
The average salary change for a new employee moving from one company to another fell in March, with the average salary increasing by only 12%. This the lowest in over two years, excluding July 2019 which also hit 12%, as the pandemic began to take its toll. At the same time, Q1 saw a 43% increase in job seekers compared to the prior quarter which indicated renewed confidence in those looking to seek new employment. Naturally, coronavirus has resulted in firms being more frugal in salaries being offered. During the 11 months prior, the average salary change was 19%.