Asset managers need to be flexible and adapt to the new ways people are working
Competition for the right talent has always been fierce in the asset management industry, but the pandemic has exacerbated this trend. As talent shortages are expected to remain severe for the foreseeable future, asset managers have to rethink the way they hire, manage and keep great people.
Global skills shortages reached a 16-year high in 2022, with 75% of employers in the banking and finance sector reporting difficulties in finding the talent they need. The Financial Services Skills Committee (FSSC), representing a membership which employs over a third of employees in the UK financial services industry, found that 92% of their member firms had hard-to-fill vacancies in 2021.
Due to the lack of skilled staff in many sectors, competition for the right people has widened beyond the asset management industry. Many traditional asset managers are now also competing with alternatives firms that are expanding their footprint in the retail space. Attracting engineers and other IT personnel is also a challenge for many asset management firms.
In fact, research from Accenture revealed more than 70% of UK asset management executives noticed an increase in the number of employees departing for roles in the tech sector. The industry’s reluctance to adopt new technologies may be a factor in employees wanting the opportunity to work for more exciting and innovative companies.
Given the size of the skills shortage in the industry, recruitment alone will not solve the issue and companies will need to invest in retaining their existing staff.
One of the challenges companies continue to face is managing the return to the workplace. The pandemic proved that remote working can be effective, and many employees are now reluctant to return to the office on a full-time basis.
Research by Deloitte among 300 senior investment management executives highlighted that a flexible working environment has a positive impact on employees’ view on the corporate culture. While 32% of respondents at firms with a hybrid workplace strategy reported that their firm’s culture has become much stronger, this figure is only 13% among respondents who work at companies where most employees returned full-time to the office.
Establishing and communicating a corporate purpose, particularly related to a firm’s ESG and diversity, equity and inclusion (DEI) policies, is also correlated to improved efficiency, revenue opportunity, and reduced employee turnover, as is a strong emphasis on learning, Deloitte said. Respondents at companies with a strong emphasis on learning were 33% more likely to report that their company’s culture was strengthening compared to those from firms that placed less emphasis on learning. A bigger focus on employee learning may also help develop and nurture employees’ soft skills, which are as essential to business success as technical skills are.
Softer skills were also among the five skills needed for future success identified by the Financial Services Skills Commission (FSSC). These included the soft skills creative thinking and coaching, as well as the technical skills data analysis & insights, software development and digital literacy.
Due to the continually changing nature of the skills needed in the financial services industry, the FSSC recommends that financial services firms identify the skills they need for future success. Establishing a recurring process to identify future skills can guide investment in reskilling and upskilling.
In summary, asset managers need to be flexible and adapt to the new ways people are working. They also need to be clear about their firm’s culture and policies, so employees know where they stand. Furthermore, they need to invest in training and support for their staff, alongside investing in new technology themselves, which will stem the flow of talent to non-traditional firms.
Our specialist team, Fundamental L&D, works with a number of high-profile financial clients, creating and establishing their employee brand strategy. We offer a deep dive into your current talent acquisition and retention strategy in order to create a bespoke roadmap that will help solve your talent challenges in any global territory.
For more information, including case studies, please speak to Sarah Fearnley-Whittingstall, Managing Director of Fundamental L&D.