Talenbrium: BFSI (Banking, Financial Services, and Insurance) Industry Labor Market Analysis, Hiring Trends, In-Demand Skills, and Talent Analysis Till 2023 and Forecast Till 2025

Michigan (MI), United States Jan. 08, 2024, BFSI industry is increasingly undertaking digital transformation to widen their capabilities, and fin tech firms is expected to partner with talent pool that drive disruptive growth and customer-focused innovation.

Introduction:

The financial volatility and instability introduced during the pandemic has led to the global players in the BFSI industry to look out for newer opportunities using both skilled human labour as well as automation. The financial industry leaders are considering disruptive technologies as an augmenter to the industry instead of a threat to its current workforce. The industry has been inculcating newer and more innovative methods of digitalising the needs of the hour. Multiple banks have been hiring not only core skilled workers such as Financial Analysts, Risk Advisors but also AI professionals and developers to meet the current day demands using the latest technology. BFSI industry will increasingly undertake digital transformation to widen their capabilities, and fin tech firms will partner with labour that drive disruptive growth and customer-focused innovation. For instance, Baiduri Bank, a leading bank in Brunei has newly established an Organisational Development and Learning Unit which aims at upskilling and reskilling the bank’s workforce – offering leadership courses, Employee Wellness initiatives, Change Management, transformational workshops, and on the job training to identify gaps in skills and competencies.

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State of the BFSI Labor Market: Key Trends and Estimates

· Cyber Security professionals will experience a robust increase in job demands in the BFSI industry. The rapid advent of digitalisation in the industry has exposed organizations to a widespread series of new security vulnerabilities.

· New York received 6150 new job demand for Network Security Engineers in 2023.

· The job demand for cyber security analyst was 1310 in London in 2023

· The gap between demand for financial and technical roles in the BFSI sector is expected to reduce by the end of 2024. New York is expected to have 134182 new job demands for the financial roles and 90050 cumulative tech roles by the end of 2024.

· The median salary for cyber security analysts was highest in New York (~ USD 1,75,100) and lowest in Budapest (~ USD 72,100) in 2023. Please note the analysis is based on the locations considered in the report which are Tampa, St. Louis, Kansas City, New York, Los Angeles, San Francisco, Columbus, London, Manchester, Edinburgh, Leeds, Frankfurt, Berlin, Amsterdam, Copenhagen, Oslo, Prague, Paris, Budapest, Stockholm

· The upcoming locations such as Prague, Tampa, St. Louis are experiencing an increase in the focus labour force and witnessing a large influx on talent from different parts of their respective countries due to a mix of factors such as lower costs and higher job demand.

· The industry has seen a sharp rise in the demand for cyber security professionals over the last 5 years. The CAGR has been twice that of the previous 5 years.

· More fintech companies are collaborating with tech professionals and digitalising the industry.

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Technology and Digital Transformation in the BFSI labor market

The BFSI (Banking, Financial Services, and Insurance) sector is undergoing a major transformation driven by technology and digital innovation. Banks have already realized filling the gap for digital skills can be challenging. Upskilling and reskilling existing workforce alongside attracting new talent with relevant expertise is going to be crucial in the next couple of years.

Impact of Technology and Digital Transformation:

Rise of new technologies: AI, Blockchain, Big Data, Cloud Computing, and Cybersecurity are reshaping financial services. New roles like Data Scientists, AI/ML Engineers, Blockchain Developers, Cloud Architects, Cybersecurity Specialists, and Digital Marketing Experts are in high demand.
Focus on customer experience: Personalized banking, mobile wallets, robo-advisors, and chatbots are changing how customers interact with financial institutions. Jobs requiring skills in UX/UI design, digital marketing, and customer relationship management are becoming increasingly important.
Automation and efficiency: Automation is streamlining back-office operations and routine tasks. While some jobs may be replaced, this also creates opportunities for upskilling and redeployment in data analysis, risk management, and compliance roles.
Regulatory landscape: As technology evolves, regulators are working to adapt regulations to ensure financial stability and consumer protection. This opens up opportunities for legal and compliance professionals with expertise in emerging technologies.

Rapid digitalization and evolving customer expectations demand a tech-savvy, nimble workforce, yet attracting and retaining such talent in a competitive landscape proves increasingly challenging.

Legacy skillsets struggle to adapt to the influx of AI and automation, creating a gap that traditional recruitment methods often fail to bridge. Additionally, the BFSI sector's image as risk-averse and slow-paced clashes with the reality of a dynamic and innovative industry, deterring potential recruits seeking fast-paced career growth. Competitive compensation packages offered by other sectors, particularly technology giants, further intensify the talent drain.

Upskilling and reskilling existing employees bridge the skill gap, fostering loyalty and attracting talent seeking continuous learning opportunities. Embracing a culture of innovation and agility demonstrates the sector's proactive approach to the future, while effectively communicating its unique value proposition, including its purpose-driven nature, can break down outdated stereotypes and attract a new generation of talent.

Addressing the BFSI talent shortage necessitates a multi-faceted approach. By investing in workforce development, cultivating a dynamic and forward-thinking environment, and clearly articulating the sector's distinct advantages, BFSI institutions can not only overcome this critical challenge but also build a future-proof workforce equipped to navigate the industry's exciting transformations.

Major locations analysed based on the talent availability, job postings, company presence and cost analysis in the report include some of the biggest financial hubs to the upcoming ones such as New York (which boasts over ¬50,000 financial and investment analysts), London housing some of the biggest companies in the industry to more upcoming locations such as St. Louis, Columbus, Prague, Budapest. Multiple other locations from Scandinavia to heartland Europe is also a part of the report.

Key Parameters used in the report include the following for over 15 job roles chosen including Investment Analysts to Ethical Hackers and Network Engineers: