According to Randstad Sourceright’s 2022 Talent Trends banking and financial services sector report, 49% of C-suite and human capital leaders in the banking and financial services industry (BFSI) report talent scarcity for IT skills.

Financial institutions are increasing their investments in areas like cybersecurity, digital banking and artificial intelligence to better serve customers while also adopting new technologies to drive their talent experience and improve operational efficiencies. According to the report, 79% of BFSI leaders said they are investing more in analytics to enhance the attraction of and engagement with talent.

The banking, financial services and insurance sector has historically relied on robust compensation packages to attract and retain top talent. According to the report, in the wake of the COVID-19 pandemic, BFSI professionals are demanding more, seeking employers who offer flexible work arrangements, greater work-life balance and a more attractive employee value proposition overall.

“The banking and financial services sector has long succeeded in attracting the best and brightest talent through compensation packages and opportunities for growth. Now they’ll need to be willing to respond to shifts in business and workplace culture,” Sam Schlimper, principal consultant at Randstad Workforce Advisory, said. “If they want to remain competitive, employers will have to close the gap between the new social contract workers seek and the traditional culture and value proposition offered by many BFSI companies. This will be especially important as they look to fill tech-driven roles where they are competing for skilled candidates across a variety of industries.”

Financial compensation for last year was relatively high, but BFSI employers still struggled with hiring challenges throughout 2021 and the first half of 2022 as they experienced high turnover and wage inflation. To beat talent shortages, 76% of talent leaders said external market data is critical to inform hiring. Meanwhile, 43% reported using innovation to improve their recruitment efforts. In addition, 80% of banking and financial services leaders said providing flexible working schedules and arrangements is an effective way to address talent scarcity, although just 38% report using this people-centric strategy.

BFSI organizations have also increased their focus and investment on diversity, equity and inclusion (DEI) to address growing talent shortages and attract the growing cohort of workers who want to work for employers that value diversity. According to the report, 83% of respondents said their DEI strategies will influence their business in 2022. While 74% believe DEI is fundamental to attracting, engaging and retaining great talent, just 41% said their hiring practices supported their diversity goals last year.

Key Findings

• 49% of C-suite and human capital leaders in the banking and financial services report talent scarcity for IT skills.
• 76% of banking and financial services employers said external market data is critical to hiring, and 43% are using innovation to improve their recruitment efforts.
• 79% of BFSI leaders said they are investing more in analytics to enhance the attraction of and engagement with talent — the highest percentage of all reported-on sectors.
• 80% of banking and financial services leaders said providing flexible working schedules and arrangements is an effective way to address talent shortages; however, just 38% report using this strategy.
• 56% of banking and financial services employers are increasing their investments in diversity search and match enablement.
• While 74% of respondents believe DEI is fundamental to attracting, engaging and retaining great talent, just 41% said their hiring practices supported their diversity goals in 2021 — the lowest percentage among reported-on sectors.