Recruitment giant Robert Walters has published its salary survey for 2018. This concentrates on Greater China and South East Asia but nevertheless looks at Europe and Australasia in passing also. Compliance appointment and hiring trends in financial services figure prominently.

The survey is wide-ranging enough to take in trends not only in banking and finance but also in maufacturing and other unrelated areas. Such is its size, however, that there is still much information about financial compliance jobs to be gleaned from it. Some of the following article dwells on audit, fintech IT and other areas that sometimes influence or complement compliance.

As in previous years, the trend towards digitalisation has put people with digital expertise in high demand across the globe. Cyber security and fintech were noticeable areas of growth and demand for big data specialists continued briskly as companies sought to implement new systems to benefit from the insights afforded by Big Data. Tech start-ups were active recruiters in London, San Francisco and Dublin, often competing against larger, more traditional companies by offering candidates equity in their businesses. Banks and financial service firms continued to bear the brunt of heavier regulation. This resulted in strong demand for regulatory and compliance skill sets along with risk, audit and legal. Next year Robert Walters expects to see the demand for regulatory and compliance people holding up while their salaries increase.

The recruitment firm advises banks that are facing candidate shortages to be flexible and consider hiring compliance people (and other 'professionals') with transferable skills, even if they do not fit the job descriptions to a nicety. It adds: "Employers should also be aware that salary alone will not attract high-calibre candidates as they are increasingly motivated by work-life balance, company culture, structured career progression and flexible working.

Oceania, tis for thee

In the wake of recent scandals in the banking and financial services sector in Australia, centered on misconduct within the banks, the pressure is on for financial institutions to be more transparent and report on their remediation projects. Robert Walters therefore expects demand to remain high and salaries to increase for people (it always calls them 'professionals,' as though it is trying to curry favour with them) with a background in compliance, regulation and risk management. That sense of caution and vigilance extends beyond financial services. Regardless of sector, Australian and New Zealand organisations are cutting costs and trying to work in leaner ways. The net result is that overall salary growth in that part of the world is only marginal in New Zealand and flat in Australia. Meanwhile, both countries are relatively close to full employment, which means that future economic growth may rely upon importing offshore talent. Formed after this year's general election, New Zealand’s government will continue the policy of its predecessor and actively encourage professional New Zealanders living overseas to come home. Australia's government is tightening its grip on 457 skilled working visas, making it harder for employers to recruit outside Australia. It remains to be seen whether, during a time of uncertainty at federal government level in Australia, that decision can be reversed.

Europe

The multiplication of national and pan-European regulatory requirements and the increase in consequent checks led to a greater number of control and monitoring jobs, following on from the recent growth in compliance jobs. In France, greater hiring activity was particularly notable outside the Paris region, with job growth everywhere. In Belgium, businesses entered a period of expansion, following a minor lull at the outset of 2017. 'Nearshoring' continued to shape recruitment activities, with a growing number of jobs opening up outside urban centres. Demand was high for internal auditors.

Germany enjoyed a buoyant year, with hiring levels up among financial service employers, where middle office people such as specialists in audit, legal regulatory, compliance and risk were in high demand; this was caused by the positive economic situation and the potential for some functions at banks relocating to Germany as a result of Brexit.

Recruitment activity in Ireland was high, with financial service firms creating opportunities for compliance and other regulatory people and a growing tech start-up community pushing up demand for IT specialists. With candidates moving around a lot, counter-offers became a popular strategy to retain staff, though many professionals were influenced by company culture and 'brand' (presumably a reference to each employing company's image) rather than salary alone. In Holland recruitment levels were buoyant, despite sluggish interim hiring early in the year as employers prepared for the introduction of the DBA Act (the Deregulation of Assessment of Independent Contractor Status Act or Wet Deregulering beoordeling Arbeidsrelaties) which contains new rules for the hiring of contractors. Mid-to-senior financial professionals became more mobile, looking for jobs that could offer significant career progression, while interim compliance specialists were sought to oversee projects relating to regulatory change.

The Spanish economy was buoyant this year, influenced by growing revenues from tourism that, in turn, drove up recruitment activity. Digitalisation projects in many businesses also helped stimulate hiring for a range of professionals. In Switzerland, demand continued for professionals with regulatory and compliance experience as businesses prepared for upcoming regulatory change.

Europe is expected to enjoy another prosperous year, with confidence remaining high among professionals and employers due to economic growth. Robert Walters also attributes this, bizarrely, to continued de-regulation - an odd observation to make about a continent that is preparing very expensively to embrace an avalanche of European Union laws such as MiFID II and the GDPR. In France, many professionals are looking for businesses which offer flexible working options. In Holland, front-office hiring in financial services may be limited, though specialists in data, IT and interim compliance will remain highly sought-after. When the DBA Act comes into force, Robert Walters expects to see a temporary slump in interim hiring as employers assess the full effects of the Act. In Germany, skills shortages will remain acute as the economic situation remains positive and employers continue to expand their operations. Professionals who can support digitalisation projects and experts with good IT skills will be in particularly short supply.

In the City

Despite uncertainty surrounding Brexit and the General Election in the UK, many businesses recruited extensively this year with a notable shift towards contract hiring. Banking and financial services firms took a relatively cautious approach to recruitment, with most demand representing replacement hiring. Compliance, risk, audit and legal were exceptions, however. People in these fields were highly sought after because of pressure from regulators. The technological sector enjoyed strong growth and specialists in cyber-security and fintech were highly sought after. Demand for IT professionals came from large multinationals that were trying to build more stable data protection systems; it also came from a growing community of small start-up tech firms in London and other regional hubs. Although opportunities were available for senior professionals, most hiring was focused on junior talent because firms were struggling to train up their own staff.

Regulatory pressure also shaped demand for so-called projects professionals. Tier One banks were looking for candidates with experience of MiFID II, GDPR, Structural Reform and BCBS 239. Mid-level to senior machine learning specialists were in demand as businesses increasingly recognised the importance of data science in driving growth and increasing productivity. Pressure from regulators also caused financial service firms to demand legal professionals who specialised in risk and compliance. Among private practice firms, demand was highest for lawyers with 2-5 years’ Post-Qualified Experience (PQE), with specialists in finance highly sought after as the sector continued to grow.

Salaries in the UK were largely stable, though exceptions were possible in quickly growing industries such as IT or for compliance officers in financial services. The UK remained a 'two-speed economy' with salaries growing faster in London than elsewhere.

Southern China

Due to more companies in this region looking for a public listing, finance professionals with a command of compliance and pre-IPO process control, in particular those possessing international accounting experience will continue to be sought after. Hong Kong’s compliance market was buoyant during 2017 and we expect it to grow further in 2018, with Asian banks driving much of the hiring demand. The introduction of new regulations and increased demand on fraud and investigation operations will see businesses hiring compliance professionals across all levels, in functions such as internal auditing, risk and trade support. Increasingly, businesses are recruiting interim support to help them on business transformation projects, in particular in financial services. More candidates are thinking of signing contracts in order to gain experience and technical knowledge. It is Robert Walters' view that this hiring trend will become a business mainstay in the future.

It also believes that the stability in salaries that pertained throughout 2017 will continue in the coming year. Specialists with sought-after skill sets will still command a premium, particularly in areas experiencing a shortage of candidates. Good opportunities will be on offer in a number of areas for professionally knowledgeable candidates with first-hand experience of China, in addition to good Mandarin and English skills, especially in the legal sector. Experience of working internationally will be an added bonus. In 2018, the attraction of high-calibre professionals will require flexible hiring criteria. The recruitment firm's advice to hiring managers faced with a shortage of talent is to move away from a close match of hard skills and focus instead on an individual’s potential and cultural fit. Also, millennials are making up a growing share of the workforce; it is increasingly important for businesses to adapt so that members of different generations can work together effectively. Managers are advised to understand what will motivate talent from different age groups, how they like to communicate and the issues that might cause conflict.

For middle- and back-office operations, hiring began the year slowly, but gradually gained momentum in the second quarter. There has been a trend towards internal auditors moving internally to other departments such as compliance and risk, and even into the business itself. This has been one of the major causes of 'replacement hiring.'

Banks continue to be the largest sector in Hong Kong's financial service sector, but their growth, apart from a few exceptions, is largely flat. There has also been a significant increase in demand for retail banking and wealth management specialists. Also, there is a consistent and highly competitive demand for global markets products lawyers with Chinese language skills, with equities and OTC derivatives remaining the most sought after. This trend will probably continue. The insurance industry saw significant growth during 2017 and this will continue with the opening of the Independent Insurance Authority. There has also been more legal hiring in other financial sectors, such as asset management, private equity and brokerages, especially those that concentrate on outgoing Chinese capital. The demand is frequently for professionals who can handle both legal and compliance matters.

Compliance hiring in Hong Kong in 2017 saw the sector continue to grow, with much of the demand in newly created positions. In banking, the biggest areas of recruitment continue to be in anti-money-laundering (AML) control and financial crime compliance (FCC), with teams attempting to grow before the AML Ordinance deadline, set for March 2018. There was also a rise across the board for product advisory compliance, with both equities and fixed-income compliance officers in high demand. With demand outstripping supply for advisory jobs, it expects that there will be a marked shortage of candidates in 2018. Hiring managers are advised to consider hiring equities or fixed-income specialists and then help them build up their product knowledge. Another option is to hire and retrain middle-office candidates, such as trade support, as they have strong product knowledge and understand the entire trade cycle. On the buy-side, increasingly stringent compliance requirements, such as the Manager-In-Charge (MIC) regime of the Securities and Futures Commission (SFC), and the Common Reporting Standard (CRS) of the Organisation for Economic Co-operation and Development (OECD), will continue to have a big effect on hiring in 2018. Compliance professionals with knowledge in these areas will be highly sought after. Given this growth, small to medium-size funds in Hong Kong are divesting general counsel of its compliance function and hiring juniors to handle reporting and licensing duties, or seniors to assume the compliance function independently. Robert Walters expects this trend to continue in 2018. Many global asset managers are seeking junior/analyst-level investment compliance talent. This remains a highly competitive market that is short of candidates, especially given the ever-growing competition from rapidly expanding Chinese investment firms. Private Equity funds are also increasingly hiring compliance officers, responding to higher demand from limited partnerships (LPs) and investors for more detailed and stringent reporting standards.

Many local and regional brokerage businesses are also hiring. Due to new regulatory standards and the arrival of new firms in the brokerage market (fintech and others), there is a lack of talent in the brokerage sector, with few candidates willing to move laterally there, preferring to progress to international platforms or technology-driven firms. This sector will continue to expand in 2018.

The compliance market in Hong Kong is expected to continue to evolve and grow in 2018. Chinese language and strong communication skills are becoming increasingly essential. Top compliance people are expected to receive multiple offers, so employers are strongly advised to provide competitive salaries and regularly evaluate other non-monetary factors such as career paths, workplace culture and flexible working hours to make their work-life balance better. The shortage of talent will persist and this will be good for competition in the market, with salary increases reaching up to 20-25% when candidates change jobs.

People in regulatory reporting in Hong Kong on contracts with 1-4 years' experience are earning HK$30-45K, and this is likely to go down very slightly next year to HK$30-40K. With 5-8 years' experience, it will remain roughly stable on HK$50-70. For more than 8 years, it remains rock steady on HK$70-100K.

Robert Walters lists AML/Surveillance under 'governance.' Contractors' salaries for 1-4 years of experience have widended in range from HK$30-50K to HK$25-55K. For 5-8 years they have narrowed somewhat from HK$65-120K to HK$60-120K. For more than 8 years, the figures remain exactly the same at HK$120-140.

Regarding people on permanent salaries, internal auditors at fund and wealth management firms received the following: for 1-4 years' experience, HK$429-560K in 2017 rising to K$420-580K in 2018; 5-8 years HK$560-900K rising to HK$580-950; and for 8 years HK$900-1,700K rising to HK$950-1,700K. People in operations in the area of KYC/client onboarding received: 1-4 years HK$300-480K rising to HK$300-540K; 5-8 years HK$480-900K narrowing to HK$540-800K; 8 years HK$900-1,400K falling to HK$800-1,400K. Big Data architects attained HK$240-360k rising to HK$300-420k (1-4 years); HK$400-540k rising to HK$480-660k (5-8); and HK$600-900k rising to HK$720k-1,000K (8+). Cybersecurity people attained HK$360-480k, remaining the same (1-4); HK$480-840k, remaining the same (5-8); and HK$840k-1,500K, remaining the same (8+).

Permanent salaries in banking compliance are as follows. AML, advisory and/or policy: HK$300-420k for 1-4 years, no change expected next year; HK$600-960k for 5-8 years, no change; and HK$1.02 million-1.5 million+ with no change. AML, transaction monitoring/surveillance is on the way up with HK$240-300k rising to HK$240-360k for 1-4 years; HK$480-720k rising to HK$540-780k for 5-8 years; and HK$840k-1,200K rising to HK$900k-1,200K for 8+. AML investigations are rising from HK$216-300k to HK$216-360k for 1-4 years; frp, HK$480-720k to HK$540-780k for 5-8 years; and from HK$840k-1,200K to HK$900k-1,200K for 8+ years. Compliance Control Room is going up from HK$240-336k to HK$240-360k (1-4 years); HK$540-780k to HK$600-840k (5-8 years); and HK$900k-1,320K to HK$960k-1,320K (8+). Compliance testing is going up from HK$300-400k to HK$300-420k (1-4); HK$540-780k to HK$600-840k (5-8); HK$900k-1,3200K to HK$960k-1,3200K (8+). Regulatory advisory is increasing slightly from HK$300-400k to HK$300-430k (1-4); HK$540-780k to HK$600-850k (5-8); and HK$900k-1,350K to HK$960k-1,400K (8+). 

Elsewhere in Asia

In Indonesia, accountants and financiers with international experience and strong compliance backgrounds will be in high demand, especially candidates with a proven ability of working with local tax authorities in Jakarta. Legal firms may continue to encounter more clients demanding faster and cheaper services, while the rise of automated compliance tools may threaten the positions of some lawyers.

In the Malaysian capital of Kuala Lumpur, salaries in compliance and legal departments are expected to rise by 20-25% next year. Tighter regulation pushed recruitment up this year and will do so next. As banks take stricter measures to tackle money laundering, the demand for compliance people is expected to remain high, especially those specialised in compliance review and testing, regulatory compliance and AML/CFT. More hiring managers are aiming to take on compliance people with experience in sanctions as well. Although demand is high, hiring managers may struggle to find compliance people who can also function as strong business advisors and balance the satisfaction of regulatory requirements with sound business decisions. There is a greater demand for in-house legal counsels who are equipped with corporate knowledge, especially if they have three-to-six years’ experience. Mid-level legal practitioners and licensed company secretaries will also be sought after.

Financial services in the Philippines expanded in 2017 as new banks and financial start-ups entered the local market. New regulations dominated this realm: a new international finance reporting standard (IFRS 9) and a credit bureau for the collation of banking credit data in retail banking, not to mention new capital and liquidity rules, had their effect on banking and insurance. In 2018, quantitative analysts will be needed to develop models to deal with the changing regulatory landscape. Hiring managers will be looking for top talent in money-laundering control and regulatory compliance.

In Singapore this year Robert Walters saw the emergence of new specialisations in audit teams, including compliance and sanctions auditing in global banks. In 2018 it expects higher demand for candidates with a mixture of business and audit experience. This would include any person who left the auditing function to take on an internal job in compliance, risk and IT and who is now open to re-entering an audit environment.

The compliance job market was less busy in 2017 than in 2016, as banks sought to control costs. Although there was active recruitment in the financial crime compliance and investigations field, most employers tried to back-fill positions rather than create new jobs. In addition, structural changes brought about by more consolidation in the asset management market stopped most companies from hiring in 2017. Compliance recruitment is expected to remain unimpressive in 2018. In response to the government’s mandate to build a workforce with a Singaporean core, the recruitment firm also saw more employers preferring to hire Singaporean citizens and permanent residents, especially for junior to mid-level positions. Banks were more open to hiring professionals from overseas to do senior jobs. The firm also believes that banks will strengthen their anti-money-laundering/terrorist finance regimes next year, along with their know-your-customer (KYC) and customer-due-diligence (CDD) functions, where different. Demand for local talent proficient in compliance regulatory, compliance advisory, investment compliance and product compliance is going to be high. Firms are advised to offer candidates a stable working environment and a wide range of opportunities to 'grow.'

In the private banking sector of Singapore, a compliance analyst/associate on a permanent salary can expect to make S$50-90K per annum next year - the same as this year's figure. A compliance manager on a permanent salary will go on making S$90-170K. A permanently appointed vice president or director will go on making S$170-350K.

In the wealth/fund management sector of Singapore, internal auditors with 1-4 years' experience can expect a permanent annual salary of S$45-80k, remaining the same next year; with 5-8 years' experience they can expect S$80-160k, remaining steady next year; and with 8+ years they can expect S$160-350k, rising to S$160-350k+ next year. In financial services generally, a compliance veep/director can command a permanent salary of S$220-400k, with the same expected next year. A financial crime analyst can expect S$50-90k; a manager can expect S$90-180; and a director or veep can expect S$180-350+k. In private banking a compliance analyst/associate can expect S$50-90k; a compliance manager/AVP can expect S$90-170k; and a compliance vice president or director can expect S$170-350+k. In investment/fund management the figures are S$50-80K; S$80-10K; and S$160-320K. For control room/trade surveillance, the figures are S$50-90k; S$90-160k; and S$160-300K.