Why, exactly, are firms still reluctant to hire ETF specialists?

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Rewind two years and the battle for talent among exchange-traded funds (ETFs) providers was heating up to boiling point. Golden handcuffs were dutifully applied to key staff and poaching was rife as new players set up in Europe.

Now, the shine has undoubtedly dimmed; redundancies have hit the sector, even in the hallowed halls of iShares, and those firms on the periphery have struggled – most recently with Russell Investments shutting most of its funds at the expense of 30 jobs.

In short, though, there’s now a fair bit of talent available, yet few firms are willing to hire. “There’s a Mexican standoff,” says one specialist ETF headhunter. “Even some of the iShares let go in January are still on the market. Everyone is willing to recruit sales people, but it’s considered more of a gamble to recruit product specialists.”

Fair enough, you might think. No financial services organisations are taking a hand over fist approach to recruitment – even for comparatively buoyant sectors – and inflows to ETFs in Europe have slowed dramatically. European listed ETFs gathered $9.9bn to July this year, according to Deutsche Bank research, a drop of 64.5% on the same period last year.

But there is an appetite to hire. Credit Suisse, which last week revealed that it had hired Matt Tagaliani as a director and James Kingston as a vice president in its physical ETFs team, and is in the market for a “good number” of new recruits in this area, according to a headhunter close to the situation.

What’s more, Vanguard Asset Management – which launched its first ETFs in Europe in May this year – is understood to be interviewing a large number of product specialists (without actually committing to a hire) and State Street has been actively looking in London, although recent recruits have been in Australia.

“The message I would put out is that there’s a window of opportunity to recruit some top talent in the ETF arena and put resources behind new products,” says Chris Sevenoaks, head of asset management at recruiters The Emerald Group. “I’m hoping that after the summer, there will be a sudden flurry of activity.”

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