Little growth expected in Scottish financial services jobs until 2014

The spectre of a further 3,000 Scottish financial services job losses, combined with negligible growth prospects for the next four years, suggests that there's little to cheer in the winter Ernst & Young Scottish Item Club economic report. However, it might not be entirely bleak.

There were just 4,300 financial services job losses in the 15 months to June 2009, according to E&Y's report - a long way below its previous forecasts . But, with Scotland's banks just beginning to roll out restructuring programmes, there's likely to be another 3,000 by mid-2010, it says.

But Dougie Adams, adviser to the Scottish Item Club, says we may have already seen a good proportion of these: "We knew that the big banks still had to announce restructuring plans, and factored this into the job losses forecast," he says. "But these figures are based on June 2009-June 2010 - since then, both RBS and Lloyds have unveiled substantial redundancies in Scotland."

While the banks north of the border continue to suffer, asset managers and back office operations in Scotland have fared comparatively well, says Adams.

But he still warns against being overly-optimistic about the future: "You have to ask, to what extent Scotland the brand has been tarnished by what happened to the banks. Previously, we could rely on our reputation for the Scottish tradition of value management. In the future, people might not see beyond what happened to HBOS and RBS."

And, as the graph below shows, E&Y is predicting little financial services job growth over the next four years: