Business students dropping banking career aspirations
The banking industry is losing popularity among business students as more and more are turning to software and computer services. According to research by Deloitte, at the current trend, software and computer services will be the aspiration of more students than banking by 2022. This may create difficulties for the banking industry as technology giants and FinTech start-ups seek to disrupt their traditional business models, with only those in possession of the required computer savvy talent able to meet the outsider challenge.
In a recent analysis by Deloitte, titled ‘Talent in Banking’, the responses* of more than 211,000 business students in 30 markets are considered in relation to their career goals and aspirations for various industries post-graduation. The consultancy was interested in identifying how many business students see banking as their career aspiration.
Global view
The results of this year’s analysis shows that competition for top talent is heating up, with more and more business students attracted by career paths within the technology industry. Between 2008 and 2015, the popularity of a career in software and computer services has risen by 4.1%, while the interest in banking has by comparison fallen 4.3%. Following the current trend, this will see software and computer services surpass banking career popularity by 2022. Across the board, the fast-moving consumer goods sector (FMCG) comes out on top with 14.44%, followed by banking with 14.41% and software and computer services third with 9.61%.
The decline in interest for banking may need to be seen as a concern for the industry, according to the researchers. One issue is that the loss of digital skills to banking will see them move into industries that may come to compete for the traditional customers of banks, such as FinTech and tech giants. Global FinTech investment has seen considerable growth of late, tripling from $4.05 billion in 2013 to $12.2 billion in 2014, research by Accenture shows.
Interestingly, the attributes least highly cited by students interested in banking are ‘a creative and dynamic work environment’, ‘attractive/exciting products and services’, and, most worryingly of all, ‘innovation’, which are ironically required for developing an adequate response to FinTech competition. The most cited attributes are ‘financial strength’, ‘market success’ and ‘prestige’.
Neil Tomlinson, Deloitte’s UK head of banking, comments: “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 FinTech and tech titans.”
UK banking
The story in the UK is somewhat different. Besides India, the UK is the only country in which more than 20% of business students surveyed are interested in a banking career. The trend has however been slopping downwards since 2008, when almost 30% of students were interested in a career in banking. Accounting and audit is the second most exciting career trajectory for students in the UK, followed by FMCG. Like the global story, software and computer services are on the increase in terms of business student interest, up from around 6% to around 9%.
In the UK, the top reasons for the banking industry that inclined students for their career choice are ‘to be competitively or intellectually challenged’, ‘to have an international career’ and ‘to have work/life balance’. ‘Creativity’ and ‘entrepreneurship’ again come somewhere near the lower end of interest for banking interested students.
Business students in the UK appear to have become enthralled by the offering of large US technology employers, including Google and Apple. When asked about the top five most popular employers among business students, Google garnered 23.3% of respondents’ interest and Apple 15.7%. J.P. Morgan came in third at 13%, followed by professional services firms at 11.6% and Goldman Sachs at 11.1%. For the banking inclined students, J.P. Morgan came out on top, followed by Goldman Sachs and Morgan Stanley.
According to Tomlinson, for banks to have access to the creative talent, likely required to compete with the tech-giants and FinTech start-ups, “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.”
* 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.
