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 of staff.
Lehman Brothers' 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 chief operating officer at Lehman Brothersin the UK, says former investment bank IT workers will move into retail financial services, such as high street banks and insurance companies.
"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.
IT staff within investment banks that are in trouble will not be tainted, says Martin. "Lehman Brothers 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.
David Bloxham, director of recruitment services at GCS, says IT workers in investment banking have been hit hardest by the job cuts and as a result these workers are looking at any areas where there are opportunities.
"We are seeing many IT workers move into the public sector. People coming from the major investment banks are seen as the crème de la crème and are very desirable employees," he says.
Bloxhamwarns that these workers need to understand the cultural change they will experience when moving into new sectors.
"It does not have the same pace and competitiveness and they could be seen as a threat," he says.
Rob Goddard, who was previously a sequel server database administrator at investment bank N M Rothschild, was recently made redundant, but found a new job doing the same thing at a high street insurance firm within two weeks.
He says it was a benefit to have an investment bank on his CV as a previous employer.
"The job I am doing now is almost exactly the same, but it was much more competitive and fast moving at N M Rothschild. The culture is completely different and it is more relaxed at my new job. At Rothschild we rarely finished on time, but now I always do."
More cuts planned
Bob McDowall, an analyst at TowerGroup, says there are more job losses to come. The number of cuts already made or announced is likely to double by the end of next year, he says.
According to TowerGroup, IT spending by European investment banks will fall by 9% next year.
The IT workers within investment banks are still regarded as about the best you can get, despite the turmoil in the sector they operate in. But with too many people chasing too few jobs, even these workers could find themselves without work for long periods.