Why JP Morgan's tech spending spree is good for Scotland
JP Morgan's $1bn IT spending spree is central to its plans to increase investment banking market share and it's adding to its army of technologists to help achieve this. Glasgow is benefiting.
Across the company, JPMorgan employs some 19,000 programmers - as Jamie Dimon highlighted in the firm's Q1 results last week - making it nearly on a par with Google's headcount.
In the investment bank, this commitment to IT is paying dividends - in a recent research note, Morgan Stanley analysts pointed to how JPM is "taking share with investment spending in IT".
Housed in the centre of Glasgow is JPMorgan's European Technology Centre, which employs over 800 people. The bank now has over 130 technology vacancies across the UK, and is currently looking to hire development and technical staff north of the border.
This year, it plans to spend $1bn on technology, with a particular focus on creating a next generation front-end derivative trading platform as well as building out electronic and algorithmic trading infrastructure for equities.
JP Morgan isn't the only financial services firm to be upping IT spend this year, and it's also not alone in recruiting techies in Scotland. Morgan Stanley, Barclays Wealth and Odyssey Technologies are all increasing headcount in technology.
"Investment banks pressed the pause button on IT investment in 2008-2009, and focused instead on becoming more cost-efficient," says Chris Pickles, head of investment banking and global accounts at BT Global Financial Services. "Now, as they look to expand again, technology - and the right technologists - are key weapons in gaining market share."
But while firms may hiring again north of the border, it's after a period of retraction in the industry as a whole, and they face issues attracting sufficient expertise.
Nick Price, managing director of IT recruiters Bright Purple Resourcing in Edinburgh, says: "During the downturn, people either relocated out of Scotland to find a new position or left the industry altogether. Finding people to fill these jobs will be a challenge down the line."
