Last year, technologists working in investment banking were dragging their heels when it came to accepting roles on back office IT projects. Now, as it’s one of the few areas offering relatively large numbers of new opportunities, more are moving across.
Capital markets firms are flagging the back office as a key priority for IT investment, according to research from Ovum entitled (excitingly) Optimization of Post-Trade Operations: A Business Requirement.
Essentially, it argues that a combination of increased trading volumes, more complex strategies like multi-asset trading and regulatory pressures (namely, Dodd-Frank forcing the centralised clearing of OTC derivatives) is forcing both large and small banks to invest in post-trade optimisation.
This has already had some effect on recruitment. As we mentioned previously, Barclays has been recruiting, largely for roles related to clearing, custody and settlements. Meanwhile, Citi, Credit Suisse, Goldman Sachs and J.P. Morgan all have back office IT roles open currently.
It’s comparatively buoyant, but unfortunately we’re comparing it against a depressed job market elsewhere. Paul Wright, senior manager with Robert Half Technology, says that most investment banks are still being “cautious” when it comes to recruiting for back office roles: “Those that exist are in the areas of project management, development and testing.”
Perhaps not surprisingly, competition for these roles is heating up. Previously, investment banks were hiking salaries on regulatory-driven back office IT roles in order to persuade technologists to move into these jobs. Now, IT professionals can no longer afford to be “picky”, says Wright, particularly in the contract market.
“From a contract or temporary perspective, where supply significantly outweighs demand, banking organisations are being very selective looking for an almost exact match of product, functional and systems experience,” he says.
Contract rates, which are already depressed, are now being offered at 20% below their peak across the board in banking IT.