eFinancialCareers

What will be hot and what will not in the coming 12 months? Here’s our verdict…

2008 will be a good year for…

Corporate finance
The bare statistics don’t make comforting reading. Preliminary figures from insider.co.uk suggest Scottish-only corporate finance deals were a mere £1.44bn in the third quarter of 2007 – down from £5bn for the same period in 2006.

However, while the mid-market may have suffered, corporate finance professionals remain convinced that the ‘bread and butter’ range of £1m to £75m remains largely unaffected by the credit crunch, and recruiters are adamant about more appointments going forward, albeit with a different focus.

Colin Grieve, senior consultant at Head Resourcing, says: “We’re anticipating a rise in areas like financial turnaround and restructuring. In 2008, we expect an increase in demand for qualified accountants with a corporate finance background – Big Four trained with experience in transaction services.”

Investment operations
Settlements, valuations, cash management, performance measurement, global custody, fund accounting and corporate actions might not set your heart racing, but over £530bn of stocks and shares are administered in Scotland, and recruiters don’t anticipate any slowdown in the fast-growing recruitment market in 2008.

Salaries have yet to surge in line with candidate requirements, but this could be set to change. Margaret Dyer, managing director of recruiters Joslin Rowe, says: “We do expect pay to go up, mainly because of the counter-offers from companies wanting to keep their staff.”

Homecomings
Lower bonuses in the City of London have many Scottish recruiters rubbing their hands in anticipation of a return of talent north of the border.

“Most people would have gone to London for the money, with the intention of returning to Scotland later in their career,” says David Bond, managing director of headhunter Cairns Bond. “Now, with reduced bonuses, new entrants to the Scottish market, and less of a salary differential, more people might come back.”

There’s always the old selling point of a better work-life balance, and now Edinburgh has been voted the most desirable place to live by Location, Location, Location, the Scottish capital has never looked so tempting…

Foreign accountants
According to a report from the Economic & Social Research Council, an aging population and low birth-rate means Scotland will need an annual influx of 20,000 migrant workers in order to prevent a shrinking economy.

Financial services, it seems, is no exception. Steve Shields, manager financial services Scotland at recruiters Badenoch & Clark, reckons the Asian sub-continent is a prime target for accountants – aided by the Fresh Talent initiative. Grieve, however, reckons the Commonwealth countries are still favoured by firms.

And 2008 will be a bad year for…

The credit crunch
No peek into 2008 would be complete without at least mentioning the potential impact of the credit crunch in Scotland.

Martin Gilbert, chief executive of Aberdeen Asset Management, told the Financial Times there will be no quick fix. “We cannot expect the same relatively benign investment climate we have enjoyed in recent years,” he said.

However, John Campbell, chairman of Scottish Financial Enterprise, uttered reassurances in the FT: “The Scottish financial sector tends to be conservative – we do not outperform during a bull market, but tend to do better during downturns,” he said. “We have minimal exposure to hedge funds, and we are not a trading nation – the trading and broking is done in London.”

Contractors
Last year was a good year for contractors, whose expertise was brought in by banks to fast-track transformation projects, and pay surged accordingly.

Shields says there was a massive demand for project-based managers and change managers (for both process and systems change), but thinks the good times could be over in 2008.

“What is driving the contractor market is projects based on long-term projections and which represent a very considerable investment by banks. If they hit the skids, they could be the first thing to be put on hold, so contractors may see a reversal of fortune.”

Buying in jobs
As a PR exercise, it didn’t exactly go well. US bank Morgan Stanley decided on Glasgow as the place to create 600 new jobs in 2007. It had already chosen Scotland because of the skills base in the country…but the SNP-led administration paid it £6m through its Regional Selective Assistance scheme anyway.

The resultant outrage at the news from the opposition, combined with the difficulty in filling the rapidly expanding growth in financial services jobs in Scotland last year, may see the government think twice before providing hand-outs to multi-billion dollar international banks…

Job-hopping
Staff retention became a real issue in 2007, particularly at a lower level, with firms increasingly focusing on career progression and benefits to prevent job-hopping.

However, at a more senior level, it seems banks have been putting their hands in their pockets to prevent talent from jumping ship, and recruiters expect less movement in the coming year.

Cairns says more and more people are locked in with golden handcuffs and retention bonuses, which they can be forced to forgo if they quit: "People often have to think seriously whether they can afford to leave."