According to research by Morgan McKinley:
80% of Londonís financial services professionals received a similar (43%) or higher (37%) bonus than last year
67% stated they were satisfied with their payout and 70% said their bonus either matched or exceeded their expectations
This is against a backdrop of 71% of financial services employers stating their companiesí bonus pots were similar or larger than 2007
New job vacancies fell 20% in Jan 08 compared to Jan 07 as market uncertainty led to a slower start to hiring for the year
However, job numbers still showed substantial growth on Dec 07 figures, up 57%
Typical of post-bonus season and consistent with the previous two years, the number of individuals wishing to change jobs rose in Jan 08, up 11% on Jan 07 and 87% on Dec 07
Basic salaries increased across all levels with the average salary rising 5% on Jan 07 to 53,246.
Bonus payouts: The round-up
The credit crunch does not appear to have affected bonus payouts by Londonís financial services institutions as strongly as predicted, according to research by Morgan McKinley. 71% of financial services organisations surveyed stated their companiesí bonus pots were similar or larger than 2007 and 80% of financial services employees in the middle and back office stated that they received a similar or higher bonus to last year. 20% received a lower amount.
Londonís financial institutions look to have managed bonus expectations well with 70% of employees claiming their bonus this year either matched or exceeded their expectations and the majority were satisfied with the payout they received (67%).
Robert Thesiger, CEO of Morgan McKinleyís parent company, Imprint Plc comments: ìFollowing on from a record bonus round in 2006/2007, speculation surrounding this yearís bonuses was enormous, particularly given the significant volumes of write downs by banks in the last quarter of the year. However, putting the impact of the credit crunch aside, 2007 was still a strong year for financial services and for the majority, bonus payouts in middle and back office functions appear to reflect this.
These findings show that most employees received a similar or higher bonus payout than last year and while there are always some exceptions, there does not seem to be large scale discontent amongst financial services professionals. Investment banks have managed expectations well.î
Skills shortage continues into 2008
Due to uncertainty caused by the credit crunch and the volatility of world markets in the last quarter of 2007 and into 2008, banks have taken a more cautious approach to hiring at the start of the year as new job vacancy figures highlight. In January 08, new job numbers were down 20% compared to the same period 12 months ago, although month-on-month job growth continued, up 57% on December 07 levels.
On the flip side, seasonal fluidity within the candidate market has begun earlier than usual this year as recent market uncertainty has prompted individuals to test the temperature of the job market pre-bonus payouts. Consistent with the previous two years, the number of new candidates increased in January 08 compared with December 07 (up 87%) and on January the previous year (up 11%). This led to new candidate numbers overtaking new job numbers last month. However, these rises are not at the levels recorded over the same period last year (December 06 - January 07), which saw individuals looking for a new role increase by a staggering 128%.
Robert Thesiger, CEO of Morgan McKinleyís parent company, Imprint Plc comments: ìThe ëwait and seeí approach currently adopted by many banks has translated into a slower start to hiring this year. As Iíve said previously, we are not going to have any clear view on how the 2008 financial services hiring market is going to shape up until the end of March, post-bonus season and once the ëcredit crunchí has worked its way fully through the system. Only then will organisations feel more confident forecasting growth plans for 2008 and beyond.î
Morgan McKinley London Employment Monitor for January
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