Here’s our look at the year that was in Australia.

Banks raised the talent bar

Banks weren’t afraid to replace current employees with higher-skilled talent this year. Frank Fucile, partner, Alex Kaar, explains: “As businesses face increasing challenges through the tightening of credit and increasing competition, executive management groups and boards are more closely scrutinising the performance of their staff, and taking action much more quickly.”

Succession planning also figured heavily in deciding to take a role to the external market, with firms focused on finding overachievers who could deliver a competitive advantage. “So while the Australian banks have publicly announced recruitment freezes, it seems that the demand for future talent continues in earnest,” adds Fucile.

The second-half coming of contractors

In late 2011 there was a surge in IT and project-management contactor roles, says Duncan Amos, division director, technology and project services, Bluefin Resources. During the first half of the year, technology positions registered at the recruitment firm were approximately 70 per cent permanent and 30 per cent contract, but in the second half these figures “had more or less reversed”.

Amos says: “Given the volume of new global and local regulatory change across banking, there is demand for project managers and business analysts who have risk and compliance domain knowledge and can drive projects involving change to businesses, systems and processes. With projects having defined timelines and budgets, the increase in demand forcontractors makes sense. Interesting though, pay rates have remained fairly stable.”

Quant roles moved to Manila

Some of the most critical, complex and dynamic quant roles at Australian banks were offshored to Manila in 2011, says Toby Aikins, client advisor, Marshall McAdam. In one firm alone, five maths and engineering PhDs were made redundant in Q4. “And this bank is not alone in choosing the Philippines for its high-quality education, English proficiency, cultural alignment and significantly lower employment costs.”

Aikins adds: “How APRA feels about this is unclear to me, but it surely throws up more questions than it answers about Basel III and its implications in Australia. What we know for sure is that the heat on regulatory capital will only increase over the next six to 24 months. We can only hope the banks have a longer-term view in mind.”

No meltdown in wealth management

“The private wealth and stockbroking market in Australia has had a tough year, but there is still a lot of positivity in this sector,” says David Holden, associate director, The Emerald Group. Despite the impending FOFA financial-planning reforms, ever tightening margins, and huge uncertainty in the equity markets, most firms are still looking to add front-end staff, while at the same time reducing back-office employees and advisors who are not profitable.

“Through all of these changes the bar is being raised higher – both in terms of advisors providing more choice and better advice to clients, and in terms of firms only bringing on board advisors who have an appropriate client base,” says Holden.

Risk and compliance got niche

Gone are the days when risk and compliance jobs (nearly) grew on trees. Compared with 2010, recruitment within these functions focused on a more limited range of financial institutions, says Jacob Smith, director, JS Careers. Many Australian banks have been conservative with their recruitment, while international, independent wealth managers and boutique corporate and institutional banks have been comparatively busy.

Given the general tightening of headcount budgets and difficulties obtaining approvals in 2011, recruitment was often driven by new regulations and risk obligations. “Some of these included: the introduction of new guidelines within the financial advice and wealth market (FOFA); changes within the stockbroking and financial markets as a result of the introduction of multiple stock exchanges; and the changes associated with US regulations on proprietary trading (Dodd-Frank),” adds  Smith.

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