IT workers from investment banks will start to move into the
retail financial services sector as job opportunities disappear in
the investment sector.
The investment banking sector has been hard hit by the credit
crunch with
banks such as Lehman Brothers, which went bankrupt in September,
laying off thousands. Lehmans' bankruptcy, after 158 years in
operation, was a key event in the current financial services
turmoil. The folding of the company put thousands of highly skilled
IT workers into the jobs market.
James Martin, former COO at Lehmans in the UK, says former
investment bank IT workers will move into retail banking as high
street banks, insurers and the like take advantage of their skills
and experience.
"The IT people from the investment banks will start to migrate
to retail financial services and they will become a very powerful
force within it," says Martin.
He says the IT workers in investment banking are some of the
most dedicated and capable available. "They live and breathe their
niche subject."
IT staff within investment banks that are in trouble will not be
tainted, says Martin. "Lehmans was a well run organisation that was
operationally efficient with very good IT." He says certain
financial products that the banks were selling caused the
problems.
There are more and more IT workers from investment banking
coming on to the market as cuts are made. Investment banks that
have let workers go include Credit Suisse and Merrill Lynch, as
well as the investment arms of banks such as HSBC.
Bob McDowall, an analyst at TowerGroup, says as many as
300,000 people could have lost their jobs in the financial
services sector globally by the end of 2009, with as many as 25% of
that total drawn from IT professionals.
He said there were more job losses to come and the number of
cuts already made or announced is likely to double by the end of
next year.
According to TowerGroup, IT spending by European investment
banks will fall 9% next year.
Martin says investment banking IT workers moving into other
businesses could be welcomed for bringing new skills or resented if
they are viewed as a threat by existing IT workers because of their
work ethic and skills.
The IT workers within investment banks are still regarded as
about thebest you can get despite the turmoil in the sector they
operate. But with too many workers chasing too few jobs even these
workers could find themselves without work for long periods.