Signs of life in the Scottish life and pensions sector

Scotland's life and pensions firms have been among the most pessimistic when it comes to offering new employment opportunities this year. But has a bumper first quarter persuaded them otherwise?

Life and pensions sector was the most likely to be decreasing staff numbers again in 2010, according to the annual Joslin Rowe Scottish financial services recruitment review, and had the highest staff turnover rate at 14%.

However, both Standard Life and Scottish Life have seen sales significantly boosted in the first quarter by recent changes to minimum retirement age (from 50 to 55). The former reported a 30% increase in life and pensions sales in the first quarter of 2010, while the latter saw new business jump to 586m.

Mark Yardley, chief executive of Royal London - the parent company of Scottish Life - described the performance as "outstanding".

So, are life and pensions firms north of the border open to recruitment again? Margaret Dyer, director of Joslin Rowe in Scotland believes there is unlikely to be a hiring spree any time soon.

"The surprising development is that new roles are being created, but I think it's still too early to say whether significant levels of recruitment are on the cards," she says.

Part of the reason is that this buoyant picture may not be sustainable. Certainly that's the opinion of analysts at Keefe, Bruyette & Woods.

In a research note, they pointed to higher than expected sales at Standard Life, saying: "This, however, was a one-off, and we expect product sales to drop sharply in 2Q10."

Similarly, Yardley's comments are not exactly reassuring: "Overall, the life and pensions market remains difficult as the economic background continues to be uncertain," he said.

"Slowly but surely recruitment is picking up in the life and pensions sector, particularly in sales and sales support roles," adds Lynn Wilson, director at Edinburgh-based insurance-focused recruiters Elite Appointments. "However, the majority of firms are still reluctant to recruit to a significant degree."