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Series 3: Jobs cuts in the financial sector
In the third part of our job crunch series, we’ll uncover job cuts that have taken place in financial institutions and firms in Singapore.
The jolt in financial jobs
A lot’s been happening in the financial scene here when it comes to job availabilities. In September, Bloomberg reported that Tudor Investment Corp closed its trading desk in Singapore as part of the group’s global shake-up which was announced in August. Its quantitative research leg is still in operation.
Meanwhile, ANZ Banking Group reduced its headcount by 300 to 1,900 over a period of 12 months, with a large part of the drop achieved through natural attrition.
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All ANZ would say was that the group has “a strong focus on simplification and productivity in every business area”.
Reuters has also reported that Goldman Sachs has shrunk the number of investment bankers it has in Singapore by 15 people. As at 2015, the number stood at 35. The company’s investment banking revenue’s slipped by 11% to US$1.79 billion (S$2.49 billion) for the second quarter of this year. The chain of action involves a cost-cutting blueprint that’ll save US$700 million (S$974.97 million) per year.
30% of its investment banking jobs are expected to be affected and we’re most likely on the hit-list together with Hong Kong and China, according to the Reuters report.
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And that’s not all – Barclay’s announced in the beginning of the year that around 1,000 staff would be cut from its investment bank segment from around the world.
How robo-advisory fills the gaps
There’s much to be done in order to stay on top of the game. Digital tools and fin-tech apps are deemed more appropriate, especially since the younger generation is keen to rely on different forms of financial advice. It would be useful for financial companies to look into the path of acquisitions or partnerships with robo-advisory startups.
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Bloomberg reports that Morgan Stanley has not made such moves as yet, but it has initiated development on its own technology to thrust its service in that very direction. James Gorman, who is the CEO of Morgan Stanley said that it’s necessary to develop tools used by robos to complement their wealth management services.
In the US, hybrid robo-advisers are used to cut costs when it comes to gathering information. Humans come in and close the deal. The growth for robo-advisory there is similar to a rocket headed into space to say the least – Assets Under Management rose from US$11.5 billion (S$16.02 billion) in April 2014 right up to a sky-high estimate of US$61 billion (S$84.98 billion) as at June this year.
The verdict
It’s really tough to predict what’s going to happen to financial jobs in the future. Robo-advisers have certainly slashed fees and costs for the customer and also financial institutions, but there’s one crucial thing that robots simply cannot do – they fall short when it comes to emotional reassurance, financial coaching and yes, the personal touch.
Wealth managers would have to prep themselves to work hand-in-hand with their clients and hope that the economic situation picks up pretty fast. It’s also time to sharpen your skills and marketability as an employee.
Keep an eye for our next series that explains just that.
(By Annette Rowena)
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- The rise of robo-advisory financial services in Singapore
- Robo advisors: The technology arms race taking the investment world by storm
- Citibank Warning – 30% of jobs at US and European banks at risk from the FinTech Boom
