Treasurer Wayne Swan’s campaign to support the mutual sector could potentially be good news for candidates. Jobs will be generated if building societies and credit unions grow their businesses and create new types of financial products as a result of the reforms.

Swan’s plan is designed to create a “fifth pillar”, using the combined power of the mutuals to put more competitive pressure on the big four banks.

Under the proposals – which aim to change customer perceptions that mutuals are not as safe as banks – the Australian Prudential Regulation Authority will quickly approve more than 20 mutuals using the term “bank” if they apply.

All mutuals will be able to display a new “government protected deposits” symbol that will confirm savings are protected in the same way as bank deposits. The Treasury will also facilitate efforts to help mutuals raise cheaper funding.

What will this all mean for employment?

“Overall it will be beneficial for candidates. When mutuals are able to compete with the banks, they will need to hire more employees with specific product skills as they broaden their product base. Currency might be one of their first areas of exposure and they might get into managed funds too,” says Warren Price, managing director, Select Personnel.

There will be a decline in the availability of talent as banks and mutuals compete for staff across a wider range of job functions than they do today, he adds. Housing finance is one of the only areas in which candidates currently move fairly freely between the two.

Building societies and credit unions will have to up their pay rates to poach more people from banks, but the reforms might put them in a better position to do so. “As the fifth pillar is able to compete on a more level playing field and profits are set to rise, mutuals will also become more competitive with their salary offerings,” explains Nick Hill, senior consultant, Reed Banking & Finance.

Are there other reasons why job seekers should join a sector which has long been regarded as a slightly dowdy employment option? Price says people often want to leave the big banks because they can be impersonal places to work. “Depending on your outlook, mutuals offer candidates a better work-life balance and less internal competition for vacant positions than the major banks,” adds Hill.