By Andrew Mitchell, VP Development and Infrastructure Support, JCB International
As Brexit continues to pre-occupy the lives of most British businesses and their customers, it’s easy to use the UK’s dragged-out withdrawal from the European Union as a convenient scapegoat for recruitment challenges facing the UK fintech sector.
The UK will be desperate to hold on to its position as a fintech global leader, and many in the industry fear difficulties accessing engineering, product and financial services talent once Brexit happens, especially a Brexit of the harder variety.
The latest Fintech Founders survey of 50 industry leaders published in August, revealed that two thirds of those questioned regarded recruitment as their biggest problem. The poll exposes what is at stake in terms of prestige at a time when the UK is the world number one for scaleup investment into fintech firms. Currently 63% of respondents agree the UK is a global leader in the sector, but only one third (33%) believe this will still be the case in five years’ time; which is surprisingly optimistic considering the recruitment conundrum.
two thirds of those questioned regarded recruitment as their biggest problem.
What the survey certainly confirms is that the industry needs to be reassured that when the UK is divorced from the free-flowing pool of talent available from EU member states, those who do have the skills needed and still want to come to the UK should find it easy to do so.
Without taking extreme care to ensure a smooth labour market in the sector, we can all too easily envision a disturbing future where companies move their headquarters out of London as they hunt overseas for talent, which would seriously shake the UK’s position as an international fintech leader.
Immigration was the political albatross that haunted David Cameron’s government, and will surely continue to be a hotly debated topic post-Halloween. With the current government espousing the Australian visa system, it’s worthy to note Australia’s recent drastic reduction in the cap for skilled independent visas. With greater autonomy may come greater politicisation which in turn could cause continued uncertainty in the perception of the UK from skilled, non-sponsored applicants.
the government, academia and the fintech industry must become more proactive to tackle the recruitment problems that threaten to hold back the UK’s hugely successful fintech sector.
Perhaps the real question to address, however, is not whether Brexit will make the situation worse, but whether there are simply not enough people available with the right skills, regardless of whether the UK is a member of the EU or not.
With this in mind, the government, academia and the fintech industry must become more proactive to tackle the recruitment problems that threaten to hold back the UK’s hugely successful fintech sector.
To do this, positively addressing the subject of vocational training is urgently required. For too long this has been an underrated solution to the shortage of people with the appropriate skills that fintech employers crave. The Fintech Founders survey detected that 56% of industry leaders mentioned their product and engineering hires were challenging.
We all know that regulation is creating a greater need for different skills, compared to 10 or 20 years ago. For example, the introduction of PSD2 is driving the demand for application programming in the burgeoning world of open banking, and there may be a dearth of PISP product professionals able to discern their QWAC’s from their QSEAL’s.
fintech employers should engage more frequently with students at university
In order to reap the benefits, the sector must turn provider to deliver effective educational programmes. As we work more closely with government and academia the next generation will hopefully gain the relevant knowledge at school that employers require.
To take the education mission a step further, fintech employers should engage more frequently with students at university and be helped to provide a higher frequency of work placements. This domain is one that for far too long been the realm of the big banks.
According to recent YouGov research around a quarter of UK employers found that the deliverables of apprenticeship providers did not suit their organisations; in particular, the lack of relevant skill addition being a notable bugbear.
If this trend continues, despite glossy advertisements, we can expect a reduction in confidence in apprenticeship programs in a repeat of YTS in the 1980’s. Students need to know that if they come and work for an established or start-up fintech business they will be working at the coal face and making real decisions much sooner in their career.
Many UK-based fintech firms are eyeing up the superb skills available in Eastern Europe
Yet whenever we talk about recruitment, all roads seem to lead back to Europe.
Many UK-based fintech firms are eyeing up the superb skills available in Eastern Europe, for example, and opening offices in countries such as Lithuania, Bulgaria and Poland. This makes sense, because if the talent cannot easily come to the UK, then the UK employers must go to the talent, especially in such a competitive marketplace.
Eastern Europe has earned a fantastic reputation for training youngsters in the developer skills that are required globally to underpin fintech, and they provide investment-return ratio potential. In Lithuania, UK firms have discovered an extremely friendly and amenable regulator who issues licenses quickly and offers direct SEPA access and strong institutional support.
The UK can learn a lot from those Eastern European countries where the learning culture is strong. We are already seeing London-based Fintech firms partnering with companies based in other EU nations as nervousness around Brexit bites.
Any person with the right intentions to work in fintech in the UK and who has the right qualifications or vocational skills, or is willing to learn, should be welcome
From a business perspective, Brexit has created a logistical and costly headache for fintech firms and led to a tad more pessimism sitting over what is usually a buoyant and positive-thinking sector. Employers have seen costs rise as they have had to obtain local licences, hire local staff and deal with other regional difficulties such as local data protection regulations.
So, can the UK remain a fintech leader in the current climate of Brexit and global talent shortages?
Of course. But only if the UK remains open-minded to attracting talent from overseas and busies itself with improving the quality of academic linkage and work-placements.
Any person with the right intentions to work in fintech in the UK and who has the right qualifications or vocational skills, or is willing to learn, should be welcome and we, the industry must work with academia more efficiently to make sure we provide the right breeding conditions. Only then will the UK have the best chance of remaining the international fintech powerhouse it has worked so, so hard to become.