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Our predictions for Nordic region financial services hiring in 2012

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Want to know where the jobs will and won’t be in the Nordics next year? Here’s our considered opinion…

2012 will be a good year for…

1) Private equity

Nordic private equity firms experienced a buoyant 2011, with the Swedish Private Equity and Venture Capital Association in September pointing to record levels of buyout investments, with healthcare, cleantech, consumer good and IT companies all providing a lot of activity. This will carry on through into 2012, forecasts Gail McManus, founder of PER Recruiting, which works within the Nordic market.

“I think the optimistic climate for private equity will by and large continue, although the big issue, of course, is going to be the attitude, or the appetite, of the banks – already, at the end 2011, we started to see some redundancies within M&A, particularly London-based roles allied to Nordic teams

“Overall, however, I feel it will be a good year; there are always opportunities for returners, often people who may be quite senior and who have good investment and venture experience.”

2) Accounting roles in hedge funds

During 2011 Nordic hedge funds outperformed many of their European and global rivals, according to the Dow Jones Credit Suisse Tremont hedge fund index, and this trend is likely to continue into 2012, even with the climate more volatile and uncertain, so creating select hiring opportunities.

“The Nordic hedge fund market did OK in 2011, especially compared with the rest of Europe. With the focus now on conserving capital and the credit markets such that even the best operators are likely to have problems raising debt capital this is likely to continue into 2012,” says Morten Astrup, chief investment officer and portfolio manager at hedge fund firm Storm Capital Management.

“What we have seen is increasing demand for people within the finance function, so the guys who do the calculations, especially as at the moment we are seeing many changes in the IFRS. We need people with auditing, accounting and international experience, particularly analysts on the finance side,” he adds

3) Global business intelligence

“The global financial world is becoming ever more complex and difficult to understand. To be able proactively to respond to those complexities, being able to understand the dynamics, is becoming more important,” says Nina Linander, partner at the Stockholm office of Stanton Chase International.

“So there is demand for people with those analytical and business intelligence skills – it may even be that this is an area where some of the analysts can apply their skills with a new focus,” she adds.

And 2012 could be a bad year for…

1) Overall growth in the job market

An over-arching theme of the final quarter results of the big banks was that Nordic banks are set for a prolonged period of cost-cutting and downsizing, what Nordea somewhat ominously described as the “new normal” of a leaner financial services sector.

This means recruitment will by and large be focused on “in-fill” and simply plugging vacancies, certainly at least for the first six months of 2012, predicts Wictor Bonde, senior consultant, banking and financial services, at Michael Page International in Stockholm.

“Much as it was during the final two quarters of 2011, recruitment at least in the first half of 2012 will be focused simply on filling in the gaps created by drastic organizational changes. When banks implement redundancy programmes – as many are doing – you always get people, who were meant to stay, looking to move around or simply move on, which creates gaps,” he points out.

In fact, the whole second half of the year is looking somewhat hard to gauge in general. “In Q3/Q4 we will probably know the result of the current eurozone implications, and that period is consequently looking very hard to predict,” adds Bonde.

2) Corporate finance, equities and trading

All these areas had a torrid 2011 and the challenging climate is expected to continue into 2012, agree recruiters.

“Corporate finance had a tough 2011 and I expect it will continue to see a pretty drastic decline during 2012. In the current climate, the market is just not prepared to pay for standardised IPOs and other M&A activity as it was in the past. This will, as was seen in 2011 too, have a knock-on effect on small or midsized banks in particular,” explains Michael Page’s Bonde.

However, Erkki Tuominen, managing partner at CV Group in Helsinki, is slightly more optimistic. While IPOs were indeed lacklustre in 2011, there could be more activity after the summer and corporate M&As could start to look up.

“Company prices are low and there is a lot of cash with investors and also many of the companies have solid balance sheets,” he says.

3) The old favourite: bonuses and pay

Becoming something of a perennial in the “bad” category since 2008, the lid is likely to remain firmly down on bonuses and pay during 2012. In a climate of contraction and consolidation and continuing political and public pressure over banking pay, there will be little incentive for the banks to pay beyond what they have to.

The uncertainty over Europe and general economic and market volatility will add to the pressure on bonuses, suggest Michael Page’s Bonde.

“There will be further constraint by the Swedish Financial Services Authority Finansinspektionen on the type of compensation packages being paid, plus the mix of cash and shares within bonuses and the sorts of lock-ins that will be included.

“Having said that, Nordic banks, like any others, will want to continue to attract the sharpest brains, and you do have to pay to get that sort of talent. So, overall, I do not think we will see drastic reductions in salaries,” he adds.

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