Bank employment profiles are very pro cyclical. Retail branches can be cut, but HQ buildings and systems are the fixed cost. Beyond that, as economies cycle up and down banks meet rising and falling demand by hiring and firing. This trend is especially pronounced in investment banking, where returns are especially volatile.
What the article says is true that traditional roles are disappearing but they're hiring technology people like crazy.
Closing branches, automating branches, that's the direction it's going. eBanking, less face-to-face transactions. Data scientists, etc, to datamine all that valuable purchase history.
So employment-wise it's bad for the population at large, but good for us techies still.
Here's an example of Goldman (not a traditional bank, but still relevant):
While I realize this article is focusing on the more traditional "bankers jobs", every time I read an article about jobs at banks, I think of things I've been told by a few close friends who worked in the industry (back when my area had a few banks who's headquarters were local).
I am good friends with a couple of folks who worked in bank IT. Both have told me similar stories despite working for different companies and not knowing each-other, so I'm reasonably convinced of their accuracy. Though it might be something limited to these local banks (who were not huge players by any stretch), I get the impression it's a common thing. Both worked in IT, one in development and one in "everything except development and mainframe[0]". The non-dev guy told me that about every 6 months, the bank would axe an entire department -- and not just some oddball, unimportant department -- in one case it was a large group of people responsible for administration around loans and mortgages. This department would cease to exist despite being once considered a necessity (and arguably still a necessity). Three months later, they'd hire in a bunch of folks and create a department that was effectively doing what the axed department was doing (sometimes under the same name and staffed with many of the same people).
Non-core departments like HR and IT would be ebb and flow in radical ways -- my developer friend was let go when they just decided they were going to pay a company in India to build all of their apps and abandoned the local Java developers who were hired on to reduce their dependency on the mainframe, which never happened.
The environment they described sounds like a caricature of "Office Space". There was one case where a guy worked a pay-period too long and discovered he was supposed to have been let go only when his direct deposit didn't appear in his bank account and one case where they had to sue a former employee because he was notified 5 years ago that his position was cut, he'd stopped coming into work, yet they continued to pay him and he continued to cash the checks.
They've both been out of "Bank IT" for a long time, now, but I'm fairly certain these issues persisted at least until 2010. I recall one of the banks, when they started offering "Online Banking", required you to use your social security number as your logon ID and limited passwords to case-insensitive, letters only, with a 10 character maximum. It just had the smell of being a clear-text password stored in a varchar(10) field on a database without case sensitivity turned on. And companies like American Express were (are?) doing things almost as badly.
Because of all of this, I have a feeling the article has some things wrong. My sense is that the banks these guys worked for never really had a net job loss, they just operated in a revolving-door fashion -- axing departments while increasing headcount in others, and then repeating every few months with the departments names' being pulled out of a hat. I don't doubt that large sums of money are thrown into automation, particularly around algorithmic trading, because it directly makes the bank money (but I doubt that's happening at any of the smaller banks like the ones that my friends worked for).
From what I understand, the same people that were let go from IT in the last round of layoffs are the only ones they can get to apply for the new jobs[1]. My buddy in IT -- who saw his department go from 10 employees to ... him and his boss ... ended up being re-staffed a few months later with five folks who had just been let go from a local competing bank and worked in IT for his boss at some point in the past... it was a revolving door with the same people going in and out of it.
[0] And it was quite literally everything. This was early 2000 so that included the handful of traditional racked servers, routers, and the small number of endpoint-desktops connected v...
I have recently come off a 6 month consulting gig at a major Australian bank. One of which is discussed in the article. Having come from working within well respected technology companies I have been stunned by the complete lack of skill in their technology work force. Even the most basic of tasks couldn't be automated due to overly locked down workstations used by staff, those tasks that could be automated are outsourced to organisations that do not automate either. Conservatively I would suggest that over 50% of the full time direct technology employees do nothing on a weekly basis. I regularly came into the office and discovered staff sitting around chatting or browsing the internet, watching Youtube. I actually worked in a hot desk environment for a few weeks around various teams and the situation was no better across large sections of the organisation. At a guess in the 6 months gig I probably spent time with around 1000 staff, of which probably under 50 could actually competently do their job and that does not even touch on the outsourcing agreements. Multiple network agreements with various outsourcing providers, no clear ownership, vendors haggling over details, no clear escalation process, ridiculously crazy per-job pricing models where the job was never actually completed correctly and would often be charged multiple times to fix it, these multi-charges then had to be challenged by teams of people. The whole situation made me realise that it was time for me to head back to well respected technology companies. The entire industry is ripe for a complete disruption. The in efficiencies, useless staff, incompetence, crazy contract terms would mean there is no way for these cumbersome oafs to complete with an even remotely agile organisation.
While not at a bank, this part sounds very familiar:
> ridiculously crazy per-job pricing models where the job was never actually completed correctly and would often be charged multiple times to fix it
IMO it indicates something about power and incentives, where somebody in the company -- possibly in sales -- benefits from being able to arbitrary rewrite or ignore rules.
They have enough political clout that supposedly standardized systems must accommodate their fundamentally unpredictable exceptions, leading to software that is fragile or insane.
> The entire industry is ripe for a complete disruption. The in efficiencies, useless staff, incompetence, crazy contract terms would mean there is no way for these cumbersome oafs to complete with an even remotely agile organisation.
SimpleBank tried to do this in the US, and ended up with a lackluster acquisition by BBVA [1]. Standard Treasury also tried this at the institution level, and also ended up with a poor acqui-hire outcome [2]. Without being able to be a technology company first, and a financial institution second, these efforts are doomed to fail. I hate to say it, but the best companies to attack this are Amazon, Google, and Walmart (companies that are either Agile or ruthlessly efficient).
With that said, I feel your pain. I work in security for a financial utility in the US, and some days, its impossible to get anything done. Use opportunities like this to sharpen your bureaucracy hacking skills (and the money isn't bad either). Failures are only lessons you don't learn from.
It seems like Bunq [1] is having some success in this space in Europe. Revolut [2], while not a bank in the traditional sense, also seems to be doing well.
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[ 4.0 ms ] story [ 40.7 ms ] threadBank employees per capita would be more interesting.
Closing branches, automating branches, that's the direction it's going. eBanking, less face-to-face transactions. Data scientists, etc, to datamine all that valuable purchase history.
So employment-wise it's bad for the population at large, but good for us techies still.
Here's an example of Goldman (not a traditional bank, but still relevant):
http://www.businessinsider.com/pie-chart-google-hiring
I am good friends with a couple of folks who worked in bank IT. Both have told me similar stories despite working for different companies and not knowing each-other, so I'm reasonably convinced of their accuracy. Though it might be something limited to these local banks (who were not huge players by any stretch), I get the impression it's a common thing. Both worked in IT, one in development and one in "everything except development and mainframe[0]". The non-dev guy told me that about every 6 months, the bank would axe an entire department -- and not just some oddball, unimportant department -- in one case it was a large group of people responsible for administration around loans and mortgages. This department would cease to exist despite being once considered a necessity (and arguably still a necessity). Three months later, they'd hire in a bunch of folks and create a department that was effectively doing what the axed department was doing (sometimes under the same name and staffed with many of the same people).
Non-core departments like HR and IT would be ebb and flow in radical ways -- my developer friend was let go when they just decided they were going to pay a company in India to build all of their apps and abandoned the local Java developers who were hired on to reduce their dependency on the mainframe, which never happened.
The environment they described sounds like a caricature of "Office Space". There was one case where a guy worked a pay-period too long and discovered he was supposed to have been let go only when his direct deposit didn't appear in his bank account and one case where they had to sue a former employee because he was notified 5 years ago that his position was cut, he'd stopped coming into work, yet they continued to pay him and he continued to cash the checks.
They've both been out of "Bank IT" for a long time, now, but I'm fairly certain these issues persisted at least until 2010. I recall one of the banks, when they started offering "Online Banking", required you to use your social security number as your logon ID and limited passwords to case-insensitive, letters only, with a 10 character maximum. It just had the smell of being a clear-text password stored in a varchar(10) field on a database without case sensitivity turned on. And companies like American Express were (are?) doing things almost as badly.
Because of all of this, I have a feeling the article has some things wrong. My sense is that the banks these guys worked for never really had a net job loss, they just operated in a revolving-door fashion -- axing departments while increasing headcount in others, and then repeating every few months with the departments names' being pulled out of a hat. I don't doubt that large sums of money are thrown into automation, particularly around algorithmic trading, because it directly makes the bank money (but I doubt that's happening at any of the smaller banks like the ones that my friends worked for).
From what I understand, the same people that were let go from IT in the last round of layoffs are the only ones they can get to apply for the new jobs[1]. My buddy in IT -- who saw his department go from 10 employees to ... him and his boss ... ended up being re-staffed a few months later with five folks who had just been let go from a local competing bank and worked in IT for his boss at some point in the past... it was a revolving door with the same people going in and out of it.
[0] And it was quite literally everything. This was early 2000 so that included the handful of traditional racked servers, routers, and the small number of endpoint-desktops connected v...
> ridiculously crazy per-job pricing models where the job was never actually completed correctly and would often be charged multiple times to fix it
IMO it indicates something about power and incentives, where somebody in the company -- possibly in sales -- benefits from being able to arbitrary rewrite or ignore rules.
They have enough political clout that supposedly standardized systems must accommodate their fundamentally unpredictable exceptions, leading to software that is fragile or insane.
SimpleBank tried to do this in the US, and ended up with a lackluster acquisition by BBVA [1]. Standard Treasury also tried this at the institution level, and also ended up with a poor acqui-hire outcome [2]. Without being able to be a technology company first, and a financial institution second, these efforts are doomed to fail. I hate to say it, but the best companies to attack this are Amazon, Google, and Walmart (companies that are either Agile or ruthlessly efficient).
With that said, I feel your pain. I work in security for a financial utility in the US, and some days, its impossible to get anything done. Use opportunities like this to sharpen your bureaucracy hacking skills (and the money isn't bad either). Failures are only lessons you don't learn from.
[1] https://en.wikipedia.org/wiki/Simple_(bank)
[2] https://www.bizjournals.com/sanjose/blog/techflash/2015/08/s...
[1] https://www.bunq.com/
[2] https://www.revolut.com/