By Tessa Bedford*
Contracting opportunities in financial services are on the rise in Australia, but it’s still an employer’s market when it comes to compensation.
“There has definitely been a push to contract over permanent in the last 12 to 18 months, and increasingly to fixed-term contracts,” says Andrew Hanson, director of financial services, Robert Walters. “Market uncertainty has meant that employers are more reluctant to commit to permanent staff.”
Trevor Bradley, practice manager, banking and financial services, Kelly Executive, agrees: “Twelve months ago we would typically be seeing maybe 20 per cent contract or fixed-term roles, but now it is closer to 40 per cent.”
Most contracts cover project work, or are for middle- or back-office positions, but the diversity of roles on offer is increasing, says Dominic Bareham, manager, financial services, Morgan McKinley.
Most fixed-term assignments last about nine to 12 months, says Bareham. “I am even seeing some firms winding back to six-month fixed-term contracts, which would have been viewed as temp roles in the past.”
The increase in contracting is driven primarily by HR mangers wanting to avoid the sign-off problems they currently face when adding permanent headcount. “The layers of approval for permanent hiring have increased, particularly for international banks that have head offices based outside Australia,” says Hanson. “With a contractor, HR can avoid the laborious process of producing a comprehensive business case for approval.”
No debate on rates
Employers still exert control over compensation. “There has been no real change in the rates being offered to contractors as there is such a strong supply of candidates,” says Hanson.
Hiring managers are also keeping recruitment costs in check by prorating the equivalent permanent salary, meaning the contractor loses the premium traditionally associated with this type of work.
Some recruiters say they have also seen a rise in “professional contractors”: people who move from one project to the next. Bradley, however, says the growing enthusiasm for contracting among candidates has arisen mainly out of necessity. “In this climate, they have had to become more flexible.”
But there is positive news for candidates who accept a short-term gig. It can be a good way of getting your foot in the door of a bank. “Of the people I have placed into 12-month contracts, around 50 per cent have then rolled over onto a second 12 months,” says Bradley.
Regulatory and compliance changes in financial services should ensure that demand for contractors is likely to stay steady this year.
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Tessa Bedford is Kiwi and a Sydney-based editor of eFinancialCareers.com This story originally appeared at efinancialcareers.com.au and is used here with permission.
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