HR heads could roll as the financial services sector prepares for a dramatic chop of back-office staff, employment experts have warned.
Figures from the latest quarterly financial services survey by the CBI and consultancy PricewaterhouseCoopers (PwC) show almost 60% of banking firms plan to axe back-office staff before the end of the year. This has risen from just 22% in the previous quarter.
Several employers have outsourced and offshored HR jobs in what is becoming an increasingly common tactic in the sector.
Last month, insurer Norwich Union announced scores of job cuts from its HR function as part of a cost-cutting exercise.
John Hitchins, UK banking leader at PwC, said further HR cuts in the sector could not be ruled out as other companies looked to save money.
Hitchins said: “Any function that does not deal with customers will be subject to review. All we do know at this point from our conversations with banks is that the job cuts will mainly be back-office roles.”
Chris Archer, head of division at HR recruitment firm Macmillan Davies Hodes, said that HR professionals who were concerned about what this development means for their future prospects should think about how essential they are to their employer’s success.
But if HR professionals were among the cull, junior administrative staff would be the most likely to be outsourced, he said.
Speaking last week, Neil Roden, group HR director at the Royal Bank of Scotland, said outsourcing was a short-term solution to cutting employment costs. If companies wanted a good long-term relationship with their customers, they should invest in training their current staff, he added.
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