London is creating 39% of new IT roles in the UK,
despite accounting for just 12% of the UK population, research by
IT staffing company
ReThink Recruitment has found.
"The regional imbalance in demand for IT skills is a consequence
of two of the heaviest users of IT - financial services and central
government - being concentrated in London. Some 20% of the total
workforce in London is involved in financial services," says
Michael Bennett, director at ReThink.
And this figure is likely to rise, says John Whiting, UK
managing director of
Harvey Nash's IT recruitment division.
He points to the leap in annual inward investment in London from
£38bn to £52bn over the past two years, and a study by
PricewaterhouseCoopers which predicts that London will become
the world's fourth largest city economy by 2020, up from sixth.
"London is seen globally as a good place to do business. A lot
of business that was previously transacted in New York is now being
transacted in London because it is regarded as a more benign
regulatory environment post-Enron.
"There is also a residual feelgood factor from London winning
the
2012 Olympics, in terms of investment in infrastructure such as
transport. That makes a difference when organisations are deciding
where to transact a chunk of their business," says Whiting.
Aidan Anglin, managing director of IT recruitment services at
Spring Technology, says, "The war for IT talent is heating up,
especially in financial services, where the sector is seeing
technology as a key differentiator. There is lots of integration
work going on because there are so many mergers and acquisitions
taking place, so those skills are also heavily in demand."
Recruitment activity is still strong in the public sector, but
it has slowed now that many projects begun over the past few years
as a result of government initiatives are fully staffed, says Simon
Church, business development director at ReThink.
As a result, the gap between public and private sector pay rates
is widening again, says Anglin.
Consultancies
In addition, consultancies in London are recruiting heavily.
"[Recruitment is] driven by the changes their clients are going
through and they are looking to hire leading-edge talent that other
organisations also wanted, so they are prepared to pay a premium,"
says Whiting.
The kinds of roles that London-based organisations are
recruiting for are also changing. Demand for more junior roles is
shrinking in London, says Church, with helpdesk, support and even
some development roles being taken offshore.
It is in the front and middle offices that financial services
companies are recruiting heavily, as they create - and frequently
update - bespoke systems to support complex transactions in areas
such as credit derivatives, asset-backed securities and interest
rate swaps.
Financial services companies, in particular, do not just want
technical skills but business understanding, says Anglin.
"Even at the code-cutting stage, they want people with some
understanding of how it all fits together. They are also asking for
a broader range of skills than they have done in the past.
"For example, they want people with both C# and database skills,
not just one or the other," he says.
Whiting agrees. "It is not about technology but how to use it to
change the way they are doing business. The skill sets they are
looking for are project directors and project managers, architects
for specific technologies and enterprise-wide developments, and
people who have skills in managing relationships with the
business," he says,
Technology skills
In terms of technologies, Anglin sees heavy demand for database
skills for trading applications, and
C#, .net and modelling languages such as XML for front-office
applications.
"Java remains popular, but growth in demand is no longer
exponential," Anglin says.
Expertise in testing tools and
J2EE is also being sought, Whiting says.
What is clear is that it is a candidates' market at the moment.
Good quality candidates typically have two to five offers on the go
at any one time, says Steven John, a team leader in the London
office of IT recruitment firm GCS.
As a consequence, recruiters have had to up their game and
shorten the recruitment process.
"They will now get first and second interviews done in one or
two days, and they understand that they need to show candidates
they are interested in them within 24 to 48 hours, otherwise
candidates will look elsewhere for an employer that makes them feel
valued.
"One of the most precious commodities in London is time, and if
someone is going to travel one and a half hours to work and give
their all to a company, they want to feel the company will give
something back to them," says John.
It is now rare to close a recruitment assignment where the
actual salary offered is not higher than the employer's original
offering, says Whiting.
The shortage of candidates is also forcing the financial
services sector to cast its net much wider than in the past, says
John.
"Three or four years ago, the main gripe from people outside the
financial services sector was that they were in a Catch 22
situation of not being able to get into it because they lacked
experience. Now financial services companies are becoming more
flexible about their prerequisites," he says.
Anglin agrees. "Companies are less concerned about hiring exact
skill sets for permanent roles and more interested in recruiting
adaptable people who can be trained and developed as technology and
projects evolve," he says.
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