Bloomberg reports that many bankers are leaving their finance positions for zero-salary technology jobs. According to Bloomberg, due to investment firms such as UBS, RBS and Deutsche Bank AG condensing lines of business, especially within debt trading, former bankers have been prompted to quit finance and put their experience into use in financial technology.
These bankers are becoming part of companies which capitalise on the changing regulatory environment within the areas of risk management, trading platforms and data analytics, and according to Eric Anderson, head of Egon Zehnder International Inc. many more investment bankers are asking him to keep them in mind for jobs in technology, which he says, “almost never happened five years ago.”
Bloomberg reports that Stu Taylor, global head of UBS Group AG, left his seven-figure salary behind during 2012, after banks cut more than 230,000 jobs in 2011. Along with three partners, Taylor risked his life savings to set up technology start-up, Algomi and went into a zero-salary moment.
Today, the bond sales management platform is used by traders, portfolio managers and investors and Taylor said the longer hours and less pay are worth it because he enjoys what he is doing, “We’re creating something I think is making a difference, and it’s mine,” he told Bloomberg.
Bloomberg believes that the increase in bankers leaving their finance jobs for technology jobs is down to a few factors which include; fewer brokers, transforming markets, considering change, technology and adding value, which Bloomberg explains as the following:
1. Fewer brokers
According to data from Bloomberg four of the big US and UK banks have let go 350,000 staff since 2008 and will continue to reduce staff levels this year. In North America there are 211,500 fewer bond brokerage jobs this year, than there were in 2008, in comparison to 500,000 job opening in tech areas such as software development and cybersecurity.
2. Ability to transform markets
Some bankers, such as Mark Whitcroft (a former director on Deutsche Bank’s New York bond syndicate desk) have left their finance jobs to join fintech start-ups which aim to transform financial markets and provide a chance to have an impact on an emerging industry rather than an existing one.
3. Considering change
According to a survey by recruitment firm Options Group Inc. 51 per cent of employees at European banks are thinking about changing jobs and 42 per cent of employees at hedge funds have the same desire to leave.
86 per cent of the bank chief executive officers surveyed by PricewaterhouseCoopers LLP last year said that technological advances are going to have the greatest impact on banking and according to McKinsey, 30 per cent of revenues at European banks will be driven by digital transformation in the future which could include replacing some people with computers.
5. Adding value
According to those interviewed by Bloomberg, adding value is going to become the focus of bond and equity sales people as new technologies move in. Ex-bankers who have left big-ticket jobs for much less money, also consider their move an investment because what they have lost financially, they say they have gained in job satisfaction.