Bloodshed in the back office

The financial sector has suddenly been stung by a string of new sackings. The retrenchments, which mainly affect support centres and local branches, are raising concerns about the state of back-office employment in Australia.

Suncorp is shedding up to 250 staff – about 200 in operations and the rest in management – as it further shrinks its embattled banking arm. The firm has been hit by high funding costs and bad debts.

Fellow second-tier struggler Bendigo and Adelaide Bank hasn’t yet announced fresh redundancies, but staff there shouldn’t be feeling too secure. The bank is already urging them to take 10 days’ unpaid leave as it battles to cut costs amid declining demand for its lending products.

There’s bad back-office news from the Big Four too. ANZ is axing about 240 roles in mortgage fulfilment centres in Sydney, Brisbane, Adelaide, Perth and Hobart. Some 150 jobs will be outsourced, with the remainder moved to the bank's Bangalore operations centre.

NAB has refused to rule out shutting more branches on top of the 35 it is already closing. And the Finance Sector Union of Australia still fears for thousands of staff whose jobs are in peril as Westpac and St George integrate their back-office and IT systems.

Unlike some of their front-office counterparts, operations staff aren’t usually selected for retrenchment because of poor individual performance, says Warren Price, managing director of Select Personnel.

“It’s more about how the bank itself is going as a business. In the case of Suncorp, for example, it’s been lagging behind for some years and the financial crisis has forced it to take these measures,” he tells eFinancialCareers.com.au.

Low-level, easily-outsourced processing jobs are most vulnerable to retrenchment, but there are signs of life further up the back-office food chain.

“I’m now noticing more hiring activity at the Australian banks, whereas just three months ago the market was dead. But it’s in areas that require senior specialists, such as in fixed income and FX. The banks want senior people who can hit the ground running,” explains Price.

Over the next few months, most recruitment will be replacement rather than growth oriented, according to Vanessa Harding-Farrenberg, joint managing director of Morgan McKinley. But a sustained market recovery, when it comes, will eventually affect employment.

“As trading levels start to recover and front office activity increases, the need for strong product controllers will come to the fore. Generally, demand within these areas is likely to be at manager level or below across both boutiques and the larger banks,” she adds.

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