From swapping chequebooks for apps to the rise of insurgent banking brands, the banking industry is evolving. Here we take a look at what impact this has on graduate recruitment within the sector.
For insight into the key issues we spoke with a range of experts in graduate recruitment: Iain Gallagher, Senior Manager – Emerging Talent at Santander; Carolyn Dickason, Director of Hays Financial Markets; Adam Thorpe, Operations Director at Randstad Financial & Professional; Vincent Karremans, Founder of Magnet.me and Gemma O’Brien, Recruitment Consultant at HR Consultancy.
Graduates need a well-rounded skill set
Carolyn from Hays Financial Markets says: “On the whole, employers are looking for a far broader skill set than they were five or ten years ago and qualifications alone aren’t sufficient to demonstrate that a candidate is good.”
Digital transformation has impacted every industry and banking is no different. So unsurprisingly banks are after graduates who know a thing or two about technology. “Banks are looking for candidates with skills who can keep up with digital change, such as agility and adaptability. New markets, products, regulations and opportunities will continue to appear, and new starters especially will need to deliver results quickly. Companies need to hire the best people and rethink their recruitment strategy, with candidates requiring a wider skills set than just a finance degree,” says Carolyn. “Banks are going to need the top data scientists that are coming out of universities, as there is going to be a huge demand for data in the next five to 10 years,” she adds.
Adam from Randstad Financial & Professional highlights the need for digital clout: “Just take one of the big banks, they have around 12m digital customers and 7.3m mobile phone users. It’s not just a new era of banking, it’s continuously evolving. Whilst graduates don’t necessarily need to be IT experts, they now need to demonstrate that they can use technology to solve business problems.”
That isn’t to say that traditional skills have been rendered superfluous. “Technology will lead the way, but project management skills will be valued too because it’s all about making sure the process is as efficient as possible,” says Carolyn. The upshot? Graduates need a more varied range of skills than ever before. “Graduates must showcase a unique blend of skills throughout the recruitment process. Banks are looking for commercial nous, customer service skills and a passion for innovation and technology,” says Adam.
Given the reputation issue surrounding banks in recent years, it’s no surprise they are on the hunt for graduates who can help with reputation management too. Carolyn tells us: “A growing focus will also see banks working harder to protect and enhance their reputations, so graduates with skills within this area including security and controls are highly desired compared to before the financial crisis.”
Gemma from HR Consultancy tells us that universities have recognised this shift and are adapting their courses to meet these new needs: “Universities are working hard to equip students with a broad spectrum of skills and have developed their courses to include both banking and economics. However this has also increased the number of graduates looking for a job making it a tougher market.”
However where many recruiters are concerned, academic prowess isn’t always enough and many graduate roles also require practical work experience too. “Employers are also looking for graduates to have had some sort of commercial work experience which is also tricky for students, couple that with a lack of interview experience and it can be tough for candidates to get that first lucky break,” says Gemma.
The type of roles available are changing
While today’s graduates crave flexibility, most of them mean a looser working schedule or the ability to work remotely, not temporary positions. According to Gemma, that is exactly what many graduates face. “In investment banking in particular there is a real focus on the graduate market. We are seeing a number of trainee vacancies filled with graduates but many of these are temporary roles – which is not ideal for graduates looking for a secure future,” says Gemma.
The rise of apprenticeships
Banking might have always been competitive, but these days it’s that much tougher to break into for graduates who now have to compete with apprentices as well as each other. Adam outlines how this can play out for graduates: “Graduates may also find themselves facing greater competition from apprentices. Most banks offer an apprenticeship scheme and this is set to be further boosted by the Apprenticeship Levy this April. Hungry apprentices could eventually catch up with their graduate colleagues without the significant debt associated with leaving university. This is typically in the region of £44,000. Apprenticeships are finally in the limelight for all the right reasons and will fast become a very attractive career opportunity.”
High churn rate in some areas
Considering the skill and effort involved in securing a place on a graduate programme, you’d be forgiven for thinking that retention rates would be high. Vincent Karremans is the founder of Magnet.me – an online network which allows students and graduate employers to connect in a direct and personal way – and he has noticed the exact opposite. “A worrying trend has been the churn rate of graduates joining financial services institutions over the past few years. Since 2013, we’ve observed that, annually, one in four (24%) graduates (who take on financial services roles) leave within the first year,” he says.
Increased desire for work-life balance
Of course demands work both ways. While previous generations may have been swayed by the prestige and high salaries a career in banking commands, millennials are more interested in achieving balance. “As ever, competitive salaries and benefits will be crucial in securing the best candidates, but to retain this firms will need to offer broad, exciting opportunities which will continue to develop and enhance skills. Flexible working is also increasingly sought after by employees and there is an increasing focus on work-life balance too,” says Carolyn.
High competition from other sectors
Banking is also facing increasing competition from other sectors. Gemma tells us: “Although there is a lack of roles, banking has a reputation for being extremely fast paced, long hours and low starting salaries. That, along with the lack of opportunities to secure a graduate role, means that many young adults are shifting to another sector.”
Recruitment has been moved in-house
Adam from Randstad tells us that this focus on the graduate market has resulted in recruitment being moved in-house. He feels this isn’t so much a money-saving idea as it is a reflection of the current emphasis on ensuring a broader skill set and an office culture match: “The biggest change in graduate recruitment over the last decade has been the shift towards banks recruiting in-house. Most banks now have a team of recruitment experts ready and poised to manage the mammoth process internally. On first glance, it may appear to be a cost-cutting exercise. This is one factor but it’s one of many – banks recognised that personality and career outlook is just as important as a candidate’s skill set. They felt that they needed to be much closer to their graduate candidates. To secure a job offer, graduates need to shine throughout the rigorous recruitment process and prove that they fit in seamlessly from a cultural perspective.”
Iain Gallagher, Senior Manager – Emerging Talent at Santander, talks us through the approach to graduate recruitment at Santander in the current recruitment climate:
The last five years
“The last five years in particular has seen us change our approach to how we market our graduate schemes with online activity becoming far more important. Targeting core sites which graduates use, and promotion via social media is key and we’ve also invested in a new website which is mobile and tablet responsive. The site provides details on our schemes but also has stories and features about current graduates, details of innovation developments along with a Launch Pad area with hints and tips on areas from surviving your studies to creating your personal brand.”
The recruitment process
“Graduates are keen to know what development opportunities there are and we have a very structured two year rotational programme. This is quite common across large corporate companies, but we have developed this further through a digital platform that’s unique for our graduates which has a wealth of development opportunities linked to the rotations, alongside a community site and a dedicated Graduate Manager who supports and coaches them over the whole period. We are constantly looking to make the whole experience more personal, simple to use and engaging, for example this year all our online assessment elements can be completed on your phone while you have a cuppa! We want to not only make the experience better for our graduates but also show them how innovative we are in our thinking which translates to the opportunities they can get involved in when they work for us.”
A bright future
“Graduate recruitment can be a challenging environment both for companies looking to attract the best graduates as well as for the graduates themselves who now, more than ever, have greater competition in securing places. However whilst it might be tougher today to secure a role than it was say ten years ago, when you do the schemes available are fantastic and a great starting block for the future.”
Like the industry at large, the way graduates are recruited in banking has changed, raising new issues and challenges. Today’s graduates must be well-rounded with skills spanning finance and digital and preferably with customer experience to boot. The roles themselves have also changed with more temporary options available as well as a rise in apprenticeships.
Despite the seeming difficulty of securing a future in banking, some are noticing a high churn rate for graduates. This indicates a bad fit between graduates and the bank and could stem from any number of issues. For example, millennials crave a work-life balance previous generations may have been happy to forgo in exchange for a higher pay check and a corner office. Other sectors are also vying for the attention of high quality graduates. “For banks, it’s important they put focus on attracting the necessary entry-level candidates. This could be with adapting salaries, work-culture, or benefits,” says Carolyn.
In reaction, many banks have pulled their recruitments in-house to refocus their efforts and through speaking with Iain from Santander it seems like a digital approach to recruitment is the way forward, ensuring that the process remains personal, supportive and accessible throughout.