Financial services job shrinkage hits Singapore for first time in 18 months

The latest quarterly numbers from Singapore’s Ministry of Manpower (MOM) showed that for the first time in the last five quarters, financial services headcount fell. This was in contrast with increases in the preceding quarters that varied between 1,700 and 2,900 for each period.

In the three months to June 2013, 1,300 jobs were lost in the financial services sector, bringing the total number of people employed in this industry to 183,600 at the end of June.

However, of the 1,300 jobs 'lost', only 260 were attributed to redundancy. This compares favourably to the 360 layoffs in the first quarter of this year, and is almost half the 460 job losses in the second quarter of 2012.

New jobs in the sector rose by 2,300 in the second quarter, the highest increase in the last 18 months.

Randstad strategic account director, Gerard Milligan, says the decline is relatively small and is probably due to a rise in the number of contractors appointed.

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“Increases in contract and temporary hiring within the banking and financial services sector result in less permanent hiring, resulting in a slight skew in the hiring numbers.”

Morgan McKinley director Chris Jay says the decline wasn’t much of a shock, given that financial institutions remain under cost pressures that are forcing them to offshore to cheaper markets, like India, or to ‘nearshore’ to Johor Bahru in Malaysia, which has become an attractive alternative to Singapore due to its competitive costs.

Jay says that in broad terms there are still difficulties in hiring, but there are ‘hot areas’ such as risk, anti-moneylaundering, and compliance. “Hiring activity in finance and accounting is steady, but in the large investment banks, which have traditionally provided all the volume, are still dealing with budget constraints and long lead times for approval to increase headcount.”

Milligan says prospects remain good. “On the whole, the hiring outlook in Singapore remains positive for the rest of the year and we are continuing to see a strong demand for talent in the banking and financial services sector, both in permanent and contract hires.”