The COVID-19 pandemic has proved to be an inflection point for many industries and the people who are building careers in those industries.
Some of the reasons for this are obvious. With remote work arrangements and touchless grocery deliveries becoming commonplace in many people’s lives, financial technologies have had to evolve to build out virtual payment infrastructures.
At the same time, the pandemic brought the U.S. economy to a near halt in the spring of 2020, which prompted employers across most industries to pause hiring.
CNBC reporter J.R. Reed wrote about this in April 2020. While payments giants like PayPal increased their Q2 hiring, “hiring at some of the most highly valued financial tech startups like SoFi and Stripe [was] down double digits since the start of the year.”
Meanwhile, Nina Trentmann at the Wall Street Journal reported in early April that companies were struggling to hire chief financial officers in the immediate wake of the pandemic. “Boards are asking CFOs planning to retire to stay,” Trentmann reported. “Some are even revising decisions to fire someone to make sure their top finance position is covered, recruiters said. Given the enhanced importance of the finance function now, a CFO’s moves during the crisis could become a career-defining decision, recruiters say.”
All of this points to ongoing instability in the world of finance — and opportunities for the organizations that navigate this moment correctly by understanding how to manage their talent resources.
Here are three trends that will define talent management in the finance sector for months and, likely, years to come.
Financial Technology Is Reorienting Toward Consumer Needs
In April 2020, Karen Burkum at the chief executive organization YPO Global wrote about changes to fintech that were emerging during the first weeks of the pandemic.
Christoph Maichel, chief executive officer of German fintech firm Wahtari, told Burkum that a major change he had seen was an industry-wide shift in conversations. People had begun to talk less about ambitious technologies like blockchains and more about practical matters involving fintech — things like building better front-end experiences for customers and securing user privacy with more and more people handling financial transactions online.
This dovetails with talent management because such a pivot creates new skills demands. Kevin Martin, chief research officer at the Institute for Corporate Productivity, writes in The Financial Times that such trends underscore the need for skills forecasting, in finance and in every other sector.
“Let us assume the move to a digital model has been accelerated by measures such as working from home,” he writes. “It is then important to ask what roles and aspects of work will change because of artificial intelligence and other advanced work automation. Our research points to a looming gap in capabilities.”
In light of these challenges, HR leaders should seek to get a comprehensive view of the individual skills each member of the workforce brings to the table, then compare those against the skills the organization will need in both the short term and the long term.
Working From Home Will Continue, and Will Be a Major Adjustment
It’s apparent that many finance-sector workers will be clocking in remotely for the next several months.
JPMorgan Co-President and Chief Operating Officer Daniel Pinto told CNBC in August 2020 that the 60,000-plus employees in the company’s corporate and investment bank will work remotely at least part-time in an arrangement he describes as “more or less permanent.”
At Fidelity, nearly all of its workforce — some 40,000 people strong — pivoted to remote work early in the pandemic, and the company has been happy with the results.
“Our client engagement has been unprecedented, and our business growth has been significant as more and more investors turn to Fidelity for the financial help they need,” Kathleen Murphy, Fidelity Investment’s president of personal investing, wrote in April. She noted then that the company was still hiring.
The devil is still in the details, however, and remote work — even in a sector as connected as finance — presents challenges. Take graduate hiring. Each academic year, a fresh group of graduates land dream jobs on Wall Street, and the onboarding that takes place has long been built on tradition.
Training and onboarding such new hires remotely comes with a steeper learning curve than in many other jobs.
“The problem is that a lot of learning at the early stage of a banking career happens by sheer absorption and exposure,” Chris Ramos at efinancialcareers writes. “If everyone’s working remotely, something will inevitably be lost in the experience.”
In fintech, especially, virtual graduate-recruitment events have become instrumental in filling the talent pipeline, Cassie Rose, a university recruiter at IMC, tells Built In Chicago.
“We’ve incorporated more interactive activities — like market-making games — to keep our audience engaged,” she says.
“We also dedicate significantly more time for Q&A, when students can either ask questions in the moment or submit them via the Q&A tool in Zoom. Overall, I think this emphasis on ensuring events are interactive will remain crucial for our long-term strategy, while simultaneously aiming to differentiate ourselves within the campus recruiting space.”
HR Will Need to Lead at a Cultural Level
As in many other sectors of the economy, finance is undergoing rapid evolution thanks to technology. This change is constantly defining and redefining the work that people do, which moves this conversation from one about tasks to one about organizational culture.
“The questions of leadership, organizational culture, current workforce planning, and future role design have traditionally been addressed discreetly,” Gartner Managing Vice President Starla Crandall writes. “Today, successful financial services business leaders increasingly address these topics together, and focus on both organizational and cultural change as a way to break the conflict between current and future workforce optimization.”
Crandall then asks two important questions:
- How can finance organizations prepare for that kind of disruption?
- How can those organizations compete for the kind of future talent they will need?
Let’s take those one by one.
First, preparing for that kind of disruption means aligning human capital resources with the company’s overall mission. That’s why we talk about the importance of the CHRO-CEO partnership, and that’s what Crandall is talking about when she says questions of culture, leadership, and workforce planning cannot be treated as discrete issues.
Second, competing for future talent means opening the door to a wider group of people, vetted for their capabilities rather than their demographics. This means creating new career paths for existing employees, reskilling people when needed, and recruiting (and being inclusive of) people from all backgrounds.
That intersection of tech-driven evolution and talent management makes HR executives crucial to the success of finance companies — from established services providers to fintech startups.