Confidence among IT contractors over job creation in the financial services sector has bounced back to its highest level since before the credit crunch, according to research from Giant Group, the contractor services provider. By Helen Beckett [Published 07/10/10]
Rates to rise
A survey of contractor confidence found that 30% of IT contractors said the financial services sector would create the most IT jobs over the next 12 months, twice as many in the previous year. Contractors are also more optimistic that rates will rise over the next 12 months: 63% of contractors expect their earnings to rise over the next year, compared to 58% one year ago.
According to Giant, a large number of financial institutions have ramped up demand for IT skills over the last six months and much of this investment is being driven by regulatory pressure. "Financial institutions are reviving projects which were put on hold during the recession. With IT departments now struggling for capacity as workloads have increased, hiring [of contractors] has once again picked up," commented Matthew Brown, managing director of Giant Group.
Regulation mountain to climb
The amount of activity in the financial services sector is confirmed by another source, financial services think-tank JWG, albeit with slightly less enthusiasm. JWG’s analysis highlights the mountain that financial institutions have to climb in order to comply with 27 new regulatory requirements introduced by the G20 since the onset of the financial crisis.
"To date, the regulatory tsunami has generated over 90,000 pages of consultation and other papers, with the reading pile topping 8,900 pages in 50+ documents in June alone”, confirmed PJ di Giammarino, CEO and founder of JWG.
JWG conducted analysis in June that highlighted the problem of current standards not supporting a single method to meet the new customer identity management requirements. A data quality exercise with ten of its members revealed that, out of 60 legal entities, only two names and addresses could be matched in their entirety.
Single customer view challenge
In addition, JWG’s research revealed a low awareness of the issues associated with the new regulations, with 41 per cent of survey participants who are responsible for data not having heard of the requirement for a Single Customer View (SCV).
Compliance projects that contractors will be drafted in to complete include the forthcoming Basel III rules and the Alternative Investment Fund Managers Directive. Both require greater transparency and disclosure from banks and fund managers – and, therefore, more sophisticated IT systems.
Additionally, points out Giant, banks and other financial institutions are] investing heavily to integrate IT systems following the wave of mergers precipitated by the financial crisis.
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