Editor’s note: Cutting Edge Information, a business intelligence firm based in Durham, contributes exclusive articles to Local Tech Wire on Thursdays. New mega-mergers in the financial services industry leave human resources teams asking some old questions: what’s next for recruiting, hiring and retention at banks and insurance firms?

Cutting Edge Information (CEI) looked at more than 14,000 financial services job openings to find the answers — and uncovered trends that show companies how to position recruiting campaigns for good times ahead.

Positive leading indicators in both recruiting and hiring point to expansion across the industry’s retail banking, investment and insurance segments. Jobs in sales and customer service, for example, dominate the field: nearly half of new openings are for sales positions and 35percent are customer service-related. When the scope is narrowed to include only investment firms, nearly 60percent of job openings seeks sales skills in their new hires. These developments are significant because the number of industry-wide openings for sales spots is an indicator of future job growth across other functions.

As the industry swings into growth mode, retaining top employees becomes more and more important. “In the knowledge economy, attrition demands executives’ undivided attention,” said Eric Bolesh, lead analyst for “Financial Services Recruiting, Hiring and Retention,” CEI’s report on current HR trends. “There are several things that top companies do, both before and after new employees are hired, to keep high-performers on board.”


Successful recruiting builds the foundation for long-term revenue growth and increased productivity. As mentioned above, an explosion in sales and customer service job openings indicates rapid expansion — and recruiting activities moving forward at breakneck speed. Companies that monitor nationwide hiring trends position themselves to catch the best candidates either on campus or in the industry.

While HR executives aim recruiting drives to fill sales and customer service positions, they also keep an eye on educational prerequisites. Currently, firms focused on corporate and investment banking require at least bachelor degrees for 61percent of their job openings. In contrast, retail banks need degrees for 30percent of their positions and insurance companies seek them for 39percent of their slots.


Hiring processes with multiple hurdles weed out lower-potential employees and leave only the best prospects for later hiring rounds. This approach decreases costs, since hiring managers save on costlier face-to-face interviews by using remotely administered tests.

These earlier steps pre-screen candidate skill, attitude, and cultural fit. Well designed tests allow hiring managers to compare applicant results against scores from employees who have gone on to success in the company. In effect, test data create “ideal employee” profiles that applicant scores are matched to.

After pre-screening, behavioral interviews that draw on candidates’ real-life experiences — and are not hypothetical Q&A exercises — encourage open-ended exchanges and reveal valuable information about interviewees. Managers use this real-world information to match candidates’ skills and experiences to specific open positions. The better a new hire’s skills and working style match her position’s requirements, the more satisfied and productive she will be.

“Developing a hiring process that works well is difficult — there is no perfect approach,” Bolesh said. “Spending some time on a multiple-hurdle program customized to open positions dramatically improves hiring efficiency.”


Retention is the natural extension of and complement to recruiting and hiring. High employee retention is best achieved through effective training programs, competitive benefits packages and supportive corporate cultures. Working constantly against retention efforts, on the other hand, are turnover and employee churn, which sabotage the best efforts of recruiters and hiring teams. “Recruiting and retention go full circle,” said Bolesh. “Corporate cultures that value retention and veteran employees also have an easier job attracting top-end talent.”

Competitive healthcare and retirement programs are critically important tools for creating happy employees. For example, 401(k) programs that match 100percent of employee contributions — and cap payouts at a generous 6 or 7percent of employee salary — will routinely attract workers while more miserly plans will not.

Worker preparation contributes more to retention than many managers think. Providing employees with the proper training when they start work clearly communicates goals and expectations — and allows them to attack their jobs with the right tools and clear objectives. Career advancement preparation is instrumental in retaining hard-working top performers who always have an eye on new challenges.

Retention concerns are more relevant now than ever: some early indicators point to increased turnover in an improving economy. As individuals feel more comfortable with the job market, they will leave the safety of their current positions for new openings elsewhere. For example, broker staffing normally experiences 15percent turnover as individuals move among brokerage houses. Recently, however, CEG Worldwide surveyed the field and determined that 41percent of respondents are considering job switches.

The bottom line

As different factors shake up the industry’s HR picture, companies strive to win high performers. “Merger and acquisition activity has created an environment where a few large companies — specifically Citigroup, Bank of America and JP Morgan — are positioned to dominate many of the area’s most lucrative sectors,” Bolesh said. “Despite the new environment, the same old human resource concerns remain — recruiting, hiring and retaining the best workers.”

Attrition and employee churn throw up stumbling blocks for HR teams and executives focused on building top-flight workforces. As the industry settles and the economy improves, talented and experienced individuals will leave their posts for a variety of reasons. Companies that monitor current recruiting trends, develop focused hiring programs and offer competitive benefits will reap the highest reward: the industry’s best employees.

Cutting Edge: www.cuttingedgeinfo.com