Double danger for banks as graduate computing careers rise in the ranks
7 December 2015
- Software and computer services set to overtake banking in popularity by 2022;
- Tech giants attracting students who most aspire to work in creative and dynamic environment;
- Banking could be at risk of becoming a ‘stepping stone’ career.
Banks face a twin threat from software giants in the battle for graduate talent, according to Deloitte, the business advisory firm.
Talent in Banking, which surveys more than 200,000 business students globally, found the popularity of a career in software and computer services has risen by 4.1 percentage points between 2008 and 2015. In comparison, banking fell by 4.3 percentage points during this time. Based on current trends, software and computer services will overtake banking in popularity by 2022. This year’s research shows business students rank* careers in fast-moving consumer goods first (14.44%); banking second (14.41%) and software and computer services third (9.61%).
Of greater concern to banks is that they are failing to attract students with the digital skills needed for competing against fintechs and new entrants. The three attributes that banking-inclined students aspire to least, relative to the business student average, are ‘a creative and dynamic work environment’, ‘attractive/exciting products and services’, and, most worryingly of all, ‘innovation’. By contrast, banking-inclined students rate traditional values such as ‘financial strength’, ‘market success’ and ‘prestige’ most highly compared to business students.
Neil Tomlinson, Deloitte’s UK head of banking, commented: “Our research indicates the popularity of banks among business students has been in decline since 2011, while software and computer services have been on an upward trajectory since 2010. With innovative talent more attracted to other industries such as software and computer services, it may challenge the banks’ ability to respond to threats from non-bank challengers such as fintechs and tech titans.
“Banks need to consider how to effectively develop and market these creative and innovative roles to millennials. They also need to ensure that they have the infrastructure – working environment, recognition schemes and reward structure – to support these types of graduates throughout their careers.”
Deloitte’s research also suggests banking is at risk of becoming a ‘stepping stone’ career for business students.
Deloitte found that ‘professional training and development’ was the top aspiration for banking-inclined students globally. While ranked top by all business students, it is valued markedly higher amongst banking-inclined students (52.6% versus 48.4%). Also within the top five aspirations was a ‘good reference for future career’, hinting that banking-inclined students are thinking ahead to a life beyond the industry.
Margaret Doyle, head of financial services research at Deloitte, said: “The data presents an interesting story in terms of what’s going on in banking students’ heads. While ‘high future earnings’ ranks second in terms of a career aspiration, a ‘competitive base salary’ and ‘performance-related bonus’ fail to make the top 10. This suggests that ambitious students may hope to receive the remuneration to which they aspire once banks have trained them, but at other financial employers, such as hedge funds, or in rival sectors, including tech companies.
“The key will be to show just what can be achieved in a banking career. More agile working, a move away from ‘presenteeism’, friendlier teams and more supportive leaders will appeal to millennials and could improve both recruitment and retention at little cost. Banks should also think about bringing in younger talent, prior to university, via apprenticeships and work placements. This will ensure banks have a stronger connection with the new generation of talent.”
About the survey
Deloitte has analysed data from 211,000 business students in 30 markets in an attempt to answer the questions such as: how popular are banks in comparison to other industries with business students; what are the top career goals and aspirations of business students considering a career in banking; and what do banking-inclined students expect from a career in the sector, and does this align with their aspirations. The research is based on a survey conducted by Universum, which polled 1.2 million students and professionals from over 2,000 universities and institutions of higher education in 55 countries in 2014-15.
*Based on the survey question: “Choose the five employers you most want to work for [from the list of employers you would consider working for], your five ideal employers”. Industry popularity by market is calculated as the number of times employers for that industry are short-listed among the five ‘ideal employers’.
Notes to editors
In this press release references to Deloitte are references to Deloitte LLP, which is among the country's leading professional services firms.
Deloitte LLP is the United Kingdom member firm of Deloitte Touche Tohmatsu Limited (“DTTL”), a UK private company limited by guarantee, whose member firms are legally separate and independent entities. Please see www.deloitte.co.uk/about for a detailed description of the legal structure of DTTL and its member firms.
The information contained in this press release is correct at the time of going to press.
Member of Deloitte Touche Tohmatsu Limited.