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Investment banks cut graduate recruitment, receiving fewer applications

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Investment banks are receiving fewer applications for graduate jobs and have cut the number of roles they’re recruiting for, despite promises of reducing working hours for junior employees.

Since the beginning of 2014, investment banks have reduced their graduate recruitment targets by 235 jobs, with banks now expecting to hire 2,148, according to research released today by High Fliers. In January, investment banks in the UK said they intended to hire 2,383 graduates this year, compared to 2,202 in 2013. The revised figure represents a 2.5% drop on the previous year – one of only two industries to reduce graduate intakes on 2013.

At the same time, the popularity of the industry appears to have waned. Make no mistake, it’s still tough to make it through the door of an investment bank, but it’s marginally easier than in 2013. For every available vacancy, there were 38.4 applications, according to the research, down from 40.4 for each job in 2012-13.

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In some ways this is surprising – investment banks have refocused their efforts on graduate recruitment, bolstering pay for juniors and recruiting graduates off-cycle in order to lessen the workload of new analysts.

However, investment banks are also weighed down by slumping revenues across their fixed income currencies and commodities (FICC) businesses, which traditionally accounts for the bulk of their profits. Barclays, Royal Bank of Scotland and UBS have all been exiting business lines entirely, while other firms have continued to cut jobs. The reduced numbers of graduate hires should therefore not come as too much of a shock.

And while application numbers have reduced, this will not be keeping banks’ graduate recruiters awake at night – most tell us they have no problem filling the vacancies and 38 applications for every role is still incredibly competitive.

Finally, investment banks continue to pay more than any other graduate employer – average pay (excluding bonuses) was £45k last year, a figure that has, however, remained unchanged.

Below are the pertinent charts from the report.

HF-vacancies2 HF-vacancies

HF-apps

HF-salary

HF-2007

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