Remember when Credit Suisse said it was moving 40 prime brokerage trading jobs from London to Dublin? Dublin-based recruiters say those jobs are now filled, and that they weren't filled with existing Credit traders who were simply migrated from London. The bank rehired, at Dublin's considerably lower rates of pay. And there was no shortage of applicants.
“Credit Suisse had hundreds of CVs for the jobs in Dublin from the Irish diaspora and expats keen to move here,” says Kieran Donoghue, head of international financial services at IDA Ireland, the country’s foreign direct investment agency.
That's good news, given that Credit Suisse ulitmately wants to add a further 60 trading jobs in Ireland's capital. Donoghue estimates that the bank is making savings of up to 40% by shifting the trading jobs out of London, although not simply by paying lower salaries. Nonetheless, junior traders in Ireland typically earn base salaries of €40-50k (£31-38.5k, $45-56k), which rises to €60-70k after five years, says Paul Smyth, managing director of Dublin-based front office headhunters Top Tier Recruitment. More experienced traders can earn salaries of €80k+. Headhunters say Credit Suisse was offering ‘expat’ packages – housing allowance, in some cases paying a proportion of a mortgage payment, relocation costs, a generous salary and even getting school places for employees with children.
Trading salaries in Dublin may yet need to rise though. While plenty of 'bankers' from London applied for Credit Suisse's jobs, one headhunter says comparatively few of those applicants had the skills required: "A lot of the trading roles were around synthetics and there were maybe four people in Dublin who could do the job,” says another headhunter. “They need to persuade people across, and they need to be relatively generous.”
If the worst comes to the worst, Credit Suisse could be the first of many banks to shift jobs across to Dublin. In many ways, it's a logical choice for investment banks and asset managers to relocate staff to in order to preserve access to the single market, but a sudden influx of people could cause problems.
“There are 30,000 staff in 250 international financial services organisations in Dublin right now,” says Donoghue, “We are a small country and there will be some capacity constraints if we have a sudden migration of people.”
If the predictions of consultants are correct, 50,000-70,000 jobs could be moving out of the City of London over the next 12 months. Clearly, Dublin is not ready for such an influx – IDA has targeted 10,000 new jobs over the next four years.
“Frankfurt or Paris are better suited to a large-scale influx of financial services professionals. A lack of construction over the past two to three years has resulted in a shortage of commercial property,” says Marie Hunt, head of research, at real estate adviser CRBE in Ireland. “But Dublin’s real issue is a severe shortage of residential property. It’s very expensive to both rent and buy property.”
Large investment banks – particularly U.S firms – will be “rebalancing their European footprint”, says Donoghue, and Dublin is an obvious location. Meanwhile, asset management firms will redomicile their investment funds in order to ensure so-called passporting rights to Europe as the UK leaves the EU. “They may transfer the people managing those funds in time, but there’s still a big question mark over this,” he says.
Already, fund manager M&G Investments is reportedly moving more of its funds to Dublin after Brexit. Morgan Stanley has earmarked Dublin and Frankfurt as a potential location for its European HQ and J.P. Morgan has indicated that “some jobs” will leave the UK as a direct result of the referendum.
In the past, Irish headhunters say the problem hasn't been persuading people to move to Dublin, it's been persuading them to stay. "They move back to London when opportunities pick up,” says one headhunter. That may be less of a problem in future.
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