If you're looking over your shoulder, worried about other companies poaching your best IT talent, you might want to direct your backward gaze toward Wall Street. The results of a recent survey suggest that the financial services sector is ramping up its poaching activities, and technology pros are at the top of its shopping list.
The survey of recruiters and hiring managers, conducted by financial employment services provider eFinancialCareers.com, found that 57 percent of respondents expect to be more aggressive about poaching employees in 2011, compared to 2010. Asked which industries they've found to be the most valuable sources of talent, the No. 1 response was technology.
I discussed the survey with Constance Melrose, managing director of eFinancialCareers North America, and asked her why tech professionals are the most highly prized targets for poaching. Her response:
Technology is absolutely core to firms being able to maintain and increase a competitive edge. It has so much to do with your ability to manage risk, your ability to handle vast quantities of real-time data, and to simulate and model around that. So when it comes to knowing what type of trading positions you can take in the market, technology is crucial to that.
The problem, she said, is the overall shortage of tech skills across industries in general, and the shortage within the financial services sector in particular:
I'm not sure how well understood it is in technology circles how cutting-edge some of the work they have done on Wall Street is. When you think about technologists-and I'm making a global statement, so let's take some caution with it-the innovation that happens in Silicon Valley is so attractive and appealing to technologists that that's competitive. Overall there aren't enough technologists to go around, and I think the field on Wall Street is developing pretty rapidly. The other thing is that everyone wants people who already have financial services experience. What we're seeing with the poaching survey is people clearly need technologists, so they're going to go where they perceive the best technology talent will be. So the reason there's a shortage is that the demand for these skills has outstripped the ability of firms to bring on people fast enough and train them fast enough.
Opportunity on Wall Street exists very much in the moment, right now. If you don't get this deal, the next person's going to get it. Consequently, you need to already be up and running. I think that's what exacerbates the shortage, because there isn't the perceived time to really bring people on and train them as much. Wall Street needs to do more in terms of bringing people on, making that investment and developing them so they have more of a pipeline of talent that's growing up in the industry.
Melrose mentioned several IT skills that are in particularly high demand on Wall Street:
Skills that are very important are the C language skills, because those languages enable people to deal with large data strings in real time. Others that are important are database skills, because there's lots of data out there that has to be managed; and project management. Many of these are fairly large-scale projects that have to be deployed, so people who can manage that and interface with the front office, middle office and back office to get all this done have skills that are important, too.
The survey also found that 37 percent of respondents expect to see an increase this year in "lift-outs," the practice of poaching an entire team of workers from another company. Melrose explained the point of the practice this way:
Let's say we haven't covered the gaming industry in our banking practice, and we need to be there. The opportunity is now or very soon; I can't wait to hire people straight out of school and train them for five years to become great bankers in that sector. I'm going to go look for a team that can really vault me ahead. I would say that lift-outs are going to be much more common within the financial sector, as opposed to a lift-out to Wall Street from another industry altogether. The point of a lift-out is you're looking for someone who has already built a track record.
My takeaway from all of this is that the financial services sector is much more inclined to steal the talent it needs than to develop it in-house. Melrose's point that the sector needs to start building its own pipeline is exactly right. The last thing anybody needs is another reason to hate Wall Street.