Drop in City workers on the lookout for new jobs

Aggressive headhunting tactics could be on the way back to the City after a sharp drop in the number of financial workers looking for a new job, according to a financial services recruitment firm.

Astbury Marsden said the number of banking and hedge fund staff actively looking for a new City job dropped 20 per cent to a 15-month low in the second quarter of this year. The recruiter said there was an average of 1.68 qualified candidates for every new City job in the second quarter, down from 2.13 candidates per role in the same period a year earlier.

The steep fall in the number of City workers on the lookout for a move coincides with new jobs in the financial sector remaining roughly stable. Companies may therefore be forced to resort to more aggressive headhunting to lure people from their firms, and some have already started.

Mark Cameron, chief operating officer at Astbury Marsden, said: "There are signs that some banks are beginning to resort to pre-credit crunch tactics of targeting competitors' key employees and teams.

"City firms had benefited from a steady flow of high-quality CVs over the last few years. Now this supply has slowed. As staff sit tight, the active poaching of staff from competitors could heat up further throughout the year."

He added that the second quarter would normally prompt a heavy flow of bankers looking to switch jobs, but this year City staff have been far more reluctant to enter the jobs market.

A year ago, the City was booming on the back of sovereign debt issuance and a high flow of rights issues and other fundraisings. But despite a rise in advisory fees reported last week, work has slowed and confidence has been hit by austerity measures and fears of a government default in Europe.

Mr Cameron said: "With slower deal flow, it is difficult for investment banks to deliver on targets. Banks are trimming staff here and there, and in that kind of uncertainty, City workers are far less willing to move."

There are still pockets of high activity in the City job market. Regulatory specialists will stay in demand as firms ensure they comply with new capital requirements for insurers and banks.

At the same time, actuaries are said to be in hot demand for work on Solvency II, the new European insurance standard.

Astbury Marsden said the number of new City jobs created last month was 5,400, up from 5,040 in the same month last year.