A new survey by Morgan McKinley reports 40 percent of financial service institutions are expecting their bonus pot to be at least 25 percent larger than last year.
The figures, which were derived from a sample of high volume recruiters in the City, state the 2006/2007 bonus season may be the strongest London’s financial institutions have seen in years.
Due to the bonus increase, finance workers are less likely to seek new job opportunities, preferring to wait for their payout before switching positions.
The trend is reflected in new candidate numbers for October, according to Morgan McKinley. The numbers have remained flat, moving up only 0.25 percent from September. New job opportunities also dropped slightly by 5.5 percent since September.
“In what has been an extremely strong year for financial services globally, we do not expect to see great hikes in hiring activity over the last quarter of the year,” says Robert Thesiger, chief executive of Morgan McKinley. “Institutions are getting ready for the upcoming bonus season as well as preparing for further headcount expansion in 2007. Early signs suggest that confidence in the City of London is running high for next year, with a number of the highest volume recruiters in the City indicating that they are looking to increase their headcount, some by as much as 25 percent.
“With financial services employers affirming that 2006/2007 will be a good year for bonuses, candidate movement in the market is likely to remain relatively steady until the bonus season has drawn to a close and bonuses are safely in their bank accounts. They will then turn their attention to job hunting and look to take advantage of the plethora of financial job opportunities that will be coming on to the market in 2007 as indicators point towards it being another buoyant year for London’s financial services industry.”