Now that a decade has passed since the global financial crisis, it’s clear the finance industry looks very different than it did in 2008. Not only is the regulatory landscape in a constant state of flux, but there is an entirely new set of players competing in the industry: start-ups and financial technology firms. With these companies changing the way banks and financial institutions operate, it’s time to start thinking about what the future of finance will look like for your career. More importantly—whether you will have what it takes to compete with your peers.
“The finance industry is undergoing a lot of change at the moment,” says Adam Harwood, a Senior Managing Director within The Execu|Search Group’s Financial Services division. “Since change can cause some degree of uncertainty, we’re seeing a key shift in hiring. And for many finance professionals, this means it is becoming increasingly difficult to find not only find a new job, but also remain within the industry we once knew it.”
This isn’t to say that finance is not still a lucrative career path, Adam assures. “The future of finance is promising, however, you need to be willing to evolve with the industry,” he advises. “To do this, you need to keep an open mind about working at new and emerging companies and transitioning into some of these more technology-focused trading and sales roles.”
To help you stay marketable in this evolving industry, continue reading for Adam’s insight on the future of finance:
A shift away from investment banking
While it’s apparent that these innovations have opened more doors in the industry for tech professionals, tech trends impacting traditional bankers have been more subtle over the years. “The number of traditional banking job openings has been on a steady decline every year since 2008,” says Adam. “The top players in sales and trading over the next decade will no longer be the same 15 firms that have traditionally dominated the industry. As these firms find new ways outside the investment banking domain to be profitable, we in turn, will see a reduction in compensation and availability for these roles.”
Where to find the most promising jobs
As big banks cut back on their trading business, more lightly regulated firms are stepping in to fill the void. And while they may not offer “traditional” solutions, this is the direction the industry is going. “Today, finance is centered around data, technology, and information,” says Adam. “This means we are not only experiencing a shift in core skills, but a major industry-wide phenomenon. These new players are quickly becoming dominating forces and transforming the industry.”
According to Adam, these are the firms represent the future of finance:
- Market makers
- Propriety trading firms
- Liquidity providers
Ensuring you are prepared for the future of finance
These industry changes are happening in real-time, so it would be a mistake to ignore these trends. “Over the last 18 months, these newer firms have experienced tremendous growth,” explains Adam. “While you may have gone to school or started your job thinking you’d be working for an investment bank for most of your career, it’s time to change this mindset. If you want to excel in this industry over the next 10-15 years, one must be open to the different types of firms gaining market share.”
In other words, the earlier you can break into one of these companies, the better. While it may feel like you are jumping into uncharted territory, being one of the first of your peers to educate yourself on the market and start working for one of these firms will give you a major leg up. If you do not have a strong technology background, don’t be discouraged! Even if you take a role that is more related to your financial specialty, you can gain exposure to new technologies and methodologies in order to start developing the STEM skills required for some of these advanced roles.