A recent audit showed a shortage of skills in Ireland’s funds sector. Nicholas Pratt looks at how the problem can be solved.
In September 2022, the trade association Irish Funds commissioned a survey of technology skills in Ireland’s asset management sector. The inaugural research was conducted by state-funded non-profit Fastrack into Information Technology (FIT), and 20 firms participated. These firms included asset managers, asset servicers, consultants and technology vendors.
Participants were asked to estimate the current and emerging tech-based vacancies as well as the skills needed to fill these vacancies. In essence, the report was designed to identify any needs or gaps in terms of technology skills and then to propose measures to address any shortages.
While software development skills will continue to be highly sought after, the audit showed a rapidly growing need for skills around new and innovative technologies, with demand for cloud computing skills expected to grow by 236%, followed by blockchain (100%) and robotic process automation (65%). Coding skills are also in high demand across all levels of expertise, with Python topping the charts, followed closely by Java.
According to Irish Funds chief executive Pat Lardner, one of the most interesting findings is that demand for technology skills is nearly equal at both entry/competent levels (54%) and expert level (46%), which shows not only the need to hire graduates with strong technical skills but also to upskill those in more senior positions.
“The data gleaned from the research suggests there are significant skills gaps emerging in the funds and asset management sector due to digital transformation, as would be expected, and the competition for similar skills across the industry is escalating exponentially,” states the report. “It is also evident from the findings that nurturing of a multi-faceted approach to growing tech talent is critical.”
“Single largest challenge”The report makes a number of conclusions. Firstly, firms’ future success will be heavily dependent on their ability to adapt to the rapid digitalisation of the workplace. Secondly, the transformative impact of new technology means a new level of dialogue about career choices within the asset management sector. And thirdly, the industry needs to build a “life-long learning ecosystem” – something which the report dubs the “single largest challenge being posed to Ireland’s national skills strategists”.
Finally, the report calls on the funds industry to forge greater links with education bodies and initiatives such as the new Tech Apprenticeship programme. “Many people may not naturally associate the funds industry with IT skills, so it’s important that our industry works together and collaborates with government, educational institutions, career guidance professionals, training and education providers and other stakeholders to raise awareness among IT professionals and upcoming graduates about the benefits of working within the funds sector,” says Lardner.
The report comes against a challenging backdrop, with Ireland reportedly in the middle of its worst skills shortage for 17 years, according to a survey of 408 Ireland-based employers from recruitment firm ManpowerGroup. The national hiring outlook for Q2 is down three points from the previous quarter and eight points down year-on-year, with 81% of employers across all industries having difficulty finding talent.
That said, the same survey also revealed that the finance and IT sectors have some of the highest hiring intention figures: +34% and +32%, respectively. "However, with the talent shortage at a record high, candidates can afford to be very selective over the roles they choose, with 79% of IT companies reporting difficulty finding skilled talent," says John Galvin, managing director of ManpowerGroup Ireland.
According to Fergal Keys, senior partner at Ireland-based financial services recruitment firm The Panel, a number of companies experienced rapid increases in staff numbers during Covid but in the past six months, staffing levels have changed and are now more in line with market conditions.
“Many people may not naturally associate the funds industry with IT skills, so it’s important that our industry works together to raise awareness among IT professionals and upcoming graduates about the benefits of working within the funds sector.”
“The tech talent shortage is seen in areas that require specialised technical skills,” says Keys. “Software developers are in demand as companies are investing in new technology platforms and applications to enhance their offering.
“Data analytics talent is very important as companies are always looking at the data to drive the business forward. Cyber resilience is high on everyone’s list of priorities, especially in this new cloud digital world. Other areas in demand include emerging technologies – AI, blockchain, digital assets and machine learning,” says Keys.
Various strategies exist to encourage more tech talent into the funds industry, he says. One is money, via higher salaries and attractive benefits and bonuses to compete with other sectors. But firms also have to consider support for relocation and remote work via flexible working conditions and training and development in order not just to attract new talent but to retain what talent may already be employed by the company.
But while Keys acknowledges that the funds industry faces challenges in competing with big tech, he is optimistic that there are enough opportunities to exploit the industry’s strengths and to differentiate it from both other sectors and other jurisdictions.
“All the global fund companies have operations in Ireland and are all hugely invested in time and budget in their tech journey,” he says. “A number of the funds companies have innovation labs and technology centres here, including JP Morgan, Citi and BNY Mellon, to name a few, and each of these firms are leaders in AI, robotics and data analytics.”
Mapping the futureFurthermore, at some of these firms, it is their digital teams that drive the core technology strategy and are responsible for mapping the company’s digital future, including how new technology such as blockchain, digital assets, analytics and AI will actually be used, says Keys.
“This is very attractive to candidates that want a career in leading-edge, innovative financial services solutions,” he says. “They can work in global teams from Ireland with very experienced international tech professionals and be at the cutting edge of technology within the funds industry.”
According to Sean Cummins, chief architect with Dublin-based fintech Fenergo, one of the firms that participated in the survey, there is a general tech skills shortage in Ireland, not just in the funds industry. “This has made it more challenging for companies to recruit the necessary people with the right experience and skillset,” he says.
There are strategies that the funds industry can adopt to compete with big tech for talent, says Cummins. Firstly it should emphasise the “unique opportunities available in the funds industry, such as the potential to shape the future of finance and contribute to the development of cutting-edge fintechs”.
“All the global fund companies have operations in Ireland and are all hugely invested in time and budget in their tech journey.”
Secondly, create a company culture that values innovation as well as a work-life balance and invest in continuous development and learning programmes to make it an attractive environment for top talent. In essence, the industry needs to do more to promote itself as one with unique opportunities for tech talent to shape the future of finance or support the next cutting-edge fintech. And firms within the industry need to do more to create a culture of innovation and invest in continuous learning and development programmes.
Cummins believes that developing more partnerships with educational bodies and universities in Ireland is critical, not only to create a pipeline of qualified candidates but also to promote diversity. For example, STEM-based initiatives like the Women in Technology programme have helped boost female participation.
“Maintaining this investment is essential, as diverse perspectives can lead to more innovative solutions, improved problem-solving, and ultimately a more competitive and sustainable industry,” says Cummins.
He adds: “In recent weeks and months, a lot of attention has been put on career paths of the future, given the potentially drastic changes that are on the horizon due to AI capabilities. Therefore, looking to non-traditional career paths and working more on individuals’ core talents and soft skills instead of qualifications may be a dramatic change that occurs over the next number of years that helps open up the marketplace to greater resource pools.”
University linksNorthern Trust is one of a number of asset servicers that have formed links with universities in Ireland. The firm has a significant presence in Limerick and works with the University of Limerick and the Limerick Institute of Technology.
It has welcomed both apprentices and interns in recent years and has also helped both institutions to develop courses so that students are ‘work-ready’ upon graduation. “We have found this incredibly useful in finding and attracting talent,” says Alison Pain, chief technology officer for Emea at Northern Trust.
“A number of the funds companies have innovation labs and technology centres here, including JP Morgan, Citi and BNY Mellon."
Pain also thinks that the technology itself will help to reduce the scale of the tech recruitment challenge. “Use of modern technology such as artificial intelligence, automation and robotics will provide opportunities to change the need for technologists and drive a broadening of the skillset required to support this work.”
The development of technology also reflects how the skills and capabilities required for the funds industry are changing, says Meliosa O'Caoimh, country head of Northern Trust Ireland. “The qualities and skills necessary for our next generation of practitioners will include the ability to absorb analytics, apply critical thinking, and gather intelligence. And equally, to continue evolving successfully, our industry needs curious minds that can help us solve the resulting challenges that will come with these opportunities."