Richard Buckingham, partner at Leathwaite, was asked to provide his insight into why certain firms are clearly winning the war for the best graduate talent.

(Article extract below)

“The geeks shall inherit the earth” became a popular phrase 10 years ago when Amazon, Facebook and Google were fast becoming the mainstream. This is now true in London where technology is snapping at banking’s heels to be the capital’s top industry. Recent data shows that a high-achieving graduate can earn the same or more at a tech firm as he or she can at an investment bank.

The average starting salary at a bank is £46,000, whereas graduate coders can earn £51,000, according to research from jobs site Glassdoor.

Technology is winning out over banking when it comes to graduate recruitment

More than one in 10 new jobs created in London last year were technology roles, according to another recruitment firm Indeed, and banking has been shrinking ever since the financial crisis and, more recently, Brexit.

At London Business School, the percentage of those gaining an MBA who went into financial services fell to 26 per cent last year from 46 per cent in 2007 and the percentage going into technology firms more than tripled, from six per cent to 20 per cent over the same period.

Banks have responded by putting a heavier emphasis on quality of life than chunky remuneration.

Tech firms are even encroaching on the Square Mile, an area traditionally associated with big banks.

In 2016, takeaway delivery app Deliveroo moved into Cannon Bridge House — on what used to be the trading floor of the London International Financial Futures and Options Exchange — and last year 5000 Amazon staff moved into Principal Place in Liverpool Street.

But some in the recruitment market are still sceptical and say that the tech industry has a long way to go before it can call itself a genuine competitor to banking.

Recruiters also say that salary data can be misleading, pointing to the fact that most people in banking receive huge bonuses which dwarf their salaries.

Despite heavy regulation, recruitment firms say top bankers can expect to earn four times their salary.

Richard Buckingham, partner at Leathwaite, says:

“At a bank or a hedge fund, you’re working for your end of year bonus. Everything is bonus oriented. At tech firms, the salary and equity options are good — which when it starts vesting can result in a lot of money.”

But while the two industries slug it out for London’s top talent and office space, both face the same potential nightmare — Brexit. Banking and tech are alike in relying heavily on foreign talent and easy access to Europe’s markets, something that could be taken away by this time next year.

However, if the two industries can survive unscathed then the fierce competition between them means London could end up with two world-class industries in the near future.

Original article can be accessed here: Evening Standard by Mark Shapland

Contact Richard Buckingham:

Richard is one of Leathwaite’s partners with responsibility for the CIO and COO businesses globally.

Previously Richard led the growth of Leathwaite’s retail financial services and digital business, very much enjoying focusing on a variety of rapidly evolving functions including data and analytics, AI, customer experience, cloud, agile transformation and cyber security.

Leathwaite launches The Pay Index - the leading online resource for senior executive compensation comparison

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