A growing number of financial services companies are expanding to open European offices, and even completely relocating from the UK in favour of offices in European Union (EU) member states as a result of Brexit, it is claimed.
Artificial intelligence (AI) platform and predictive market intelligence firm Talent Ticker says the trend in the financial services sector is evident from a review of the platform’s data.
While London remains a hub for the industry, companies have generally shown caution in hiring in the city in recent months. The firm’s investigation reveals a 30% increase in banks making job cuts compared to the same period in 2017, which suggests that the UK could be losing out as a result of Brexit.
For example, JP Morgan has reportedly made 300 employees agree to move to France or Germany in the event of a no-deal Brexit, as the investment bank seeks to reduce risk of disruption by a hard exit from the EU. The firm’s predictive analytics reveals that the industry is likely to see more companies follow suit.
“However Brexit unfolds, gaining access to great talent will play a big part in the future of the banking world,” says Talent Ticker founder and CEO, Nick Vaughan. “Trends show growing consumer trust in online banking and this has enabled more emerging technologies to also enter the arena, with things such as AI and automation playing an increasingly bigger part in banking.
“Most of the talent who build these great products are still based in the UK and want to stay here so London will always remain as a talent powerhouse, globally.
“It’s now more crucial than ever than financial service companies speak to their staff to understand what is keeping them up at night. There needs to be clear internal communication about whether staff are going to be affected.”
The firm sees Ireland, France and Germany as the most prominent countries likely to see an influx of financial services employees, with Frankfurt the most popular destination. Luxembourg is also a likely place for relocation according to the AI platform.
It singles out the financial services roles most at risk of being lost to European locations as including private banking, trading, sales, operations, middle office and risk and compliance.
The AI platform has found that banks are relocating away from London and the UK, cutting down on costs in the UK in search for more stable and cheap alternatives.
In the event of a no-deal Brexit, it predicts that a growing number of financial service firms will move out of the capital to allow them to continue trading within the EU.
Although many traditional financial services firms are shying away from London and the UK, other major British cities such as Cardiff, Bristol, and Glasgow are becoming hubs for technological innovation, with emerging fintechs appearing across the country every week.
The firm’s data shows a low-cost centre such as Glasgow has seen an 80% increase in jobs created in the financial services industry.
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