Career Advice Job Market Trend Report

Shanghai rising

Shanghai's rise to prominence as a global financial centre will no doubt continue as China consolidates its position as an economic power, while personal wealth in the country increases. This will spur demand for expertise in banking and financial services, as corporate and individual clients look for more diverse investment opportunities and international players push for a bigger slice of the market.

But while firms are hiring, their approach is cautious and selective. Any thought that China could experience a finance-jobs boom, even as the sector struggles in other parts of the world, should therefore be put firmly to one side. Anyone also eyeing a career move from Hong Kong or elsewhere to the mainland should realise that fluency in Putonghua - on top of international experience - is no longer an optional extra, but one of the prime requirements.

"A lot of financial institutions are focusing on localisation, meaning that fewer expat candidates are required," says Kenny Sy, general manager for Talent2 Shanghai. "Of course, the uncertainty of the global economy has also affected overall demand for talent.

"The number of IPOs and M&A deals has decreased significantly and, in certain cases, the big international names have imposed tight cost controls from headquarters."

At present, the priority for many mainland-based firms is to strengthen their back-office teams and middle management. There is also a drive to establish stronger networks in so-called second- and third-tier cities such as Chongqing and Chengdu. Any more-senior hires are generally with a view to expanding operations overseas.

In addition, there is steady demand for credit-risk specialists with international exposure, and sales executives at various levels who have the contacts and know-how to generate new revenue. Their skills are crucial for stability and future growth, but home-grown talent can see those opportunities too.

"In areas such as risk management, people from Hong Kong still have an advantage," Sy says. "But it may become more difficult for 'expat' candidates to find roles unless they speak fluent Putonghua, have relevant experience, and know the local market."

Paul Hanley, director and head of the Shanghai office for Robert Walters China, is similarly realistic. At present, he sees clients moving more mid- and back-office jobs to the mainland, with the overall focus on cost savings and process improvement.

Over the past few years, larger foreign banks have built up the infrastructure to support solid growth. Most of the attention now is on expanding their customer base, reducing operational costs across the region, and tapping into areas such as wealth management for high-net-worth investors.

"Institutions with a secure foundation in China all talk in a similar vein," Hanley says. "They are looking to transfer more mid- or back-office functions to the mainland from higher-cost-base areas. Compared with Hong Kong, the variance in skills and quality is getting closer."

General corporate-banking recruitment may have tailed off in line with the slowdown in M&A activity, but there is still strong demand for certain types of front-office roles. In particular, the drive to attract clients - individuals and enterprises - who have "new money" has increased the need for premier relationship managers able to advise on and oversee investment portfolios.

"Banks in Shanghai are completely open-minded. They want to get the best talent," Hanley says. "Because wealth management is a relatively new product in China, it makes sense for foreign banks, who are building up that business, to bring in people from Hong Kong or Singapore."

This is more of a project-related concept, however, and is likely to change once the necessary skills are readily available in Shanghai and business models and required practices are well in place.

"The reality is that senior people from overseas will not be needed long term," Hanley says. "The key thing is to have good on-the-ground hires who can come in, develop a portfolio of clients, and gain their trust."

Separately, he notes that a significant number of medium-sized banks, based in Europe and other parts of the world, have opened representative offices in Shanghai over the past 18 months. Most begin with trade finance but, given China's potential, it is fair to assume they will have an eye on the talent pool and chances for growth in the corporate-banking and wealth-management sectors.

In this respect, Mark Enticott, managing director of recruitment firm Ambition, points out just how much the banking and finance talent pool has expanded in China over the past six years or so.

The focus before was firmly on luring qualified people from Hong Kong, or hiring "returnees" with work experience in New York or London and the necessary language skills.

"That can still happen, but given the markets at the moment, there is less need," Enticott says. "Banks are looking more at replacement positions, not headcount expansion."