License article

Weak outlook for finance jobs

The outlook for financial services jobs is expected to remain weak in 2013 as a combination of softer borrowing and technological changes sap employment in the sector.

Financial services jobs will grow only 0.3 per cent in the year to May 2013, according to the MyCareer Employment Forecast, prepared by Economic and Market Development Advisors. That compares to 10.2 per cent jobs growth expected for mining, 3.6 per cent for engineering and 3.2 per cent for health and community services in the same period.

The May 2013 quarter growth projection represents a moderate recovery from a 0.1 per cent fall in February 2013 quarter projection, said economist Michael Emerson of EMDA. "But by no stretch of the imagination is growth going back to any sort of boom-time, like in 2006-07, before the financial crisis hit, when jobs in the sector grew at 6-8 per cent per annum," he said.

Since the global financial crisis hit in 2007-8, the pace of borrowing for homes has slumped to a 35-year low, undercutting a key driver of growth in the financial sector. At the same time, the globalisation of the services sector, aided by improved technology and communication, has allowed banks to eliminate swathes of back-office jobs.

By other measures, the outlook for banking and financial services jobs may be worse. Financial services specialist site eFinancial Careers noted that Australia ranked last in an international quarterly assessment of job listings for the sector.


In the third quarter, there was a 34 per cent plunge in job financial sector job opportunities, the group said.

The sluggish outlook for growth in financial services follows a year of job cuts at the major banks, which shed a combined 6600 positions last financial year, even as they racked up about $25 billion in profits.

The banks themselves have signalled the possibility of further reductions in payrolls in the year ahead, as the slower pace of borrowing drives more cost cutting.

ANZ Bank, for example, said it is looking to maintain momentum in cost reductions including more use of overseas processing hubs. ANZ announced 1000 job cuts in Australia last year, although an analysis by KPMG showed the total headcount fell by 2058 people from 2011 to 2012.

Westpac chief executive Gail Kelly said last week overall staff numbers would reduce "next year relative to this year but probably not at quite the rate at which we've had over the last few years." Commonwealth Bank, while ruling out offshoring, left the door open to further cuts in staffing levels.

"The Commonwealth Bank regularly reviews its operations, though has no targets for staff cuts," said a spokeswoman for the company.

The Finance Sector Union has pledged to fight what is sees as the unnecessary offshoring of jobs.

"Genuine re-structures are fair enough because the nature of work changes all the time," said FSU spokeswoman Leanne Shingles. "What's unacceptable is where jobs are sent offshore and there is no restructure happening and there is still a need for the work to be done."

MyCareer is owned by Fairfax Media, publisher of this site.