Tech hiring by financial firms remains very strong
Technology is driving change in how the financial services industry operates, like mobile and digital banking or even virtual advisors. Digital transformation at the forefront of the industry means hiring tech talent is a must.
Tim Herbert, chief research officer at CompTIA, an IT industry group, tracks tech job postings in the U.S. across industries. I asked him to share his observations.
“The financial sector increased its share of tech job postings slightly during Q1 2023,” Herbert says. “On the one hand tech hiring by financial companies is down relative to the highs of last year; on the other, the financial sector continues to outperform most other sectors on a relative basis.”
He continues, “Taking a longer-term view, all signs point to a continuation of strong demand by financial services firms for software development, data science and analytics, cybersecurity, cloud infrastructure, and A.I. skills. The data suggests any lull in hiring is likely to be relatively short-lived.”
In Q1 2023, the finance and insurance sector represented 18.7% of tech job postings in the U.S., compared to 18.2% the same time the year prior, and 15.4% in Q1 2021, according to CompTIA’s data. That came second to the traditional tech job category of professional, scientific, and technical services with 25.7% in Q1 2023, down from 28.1% in Q1 2022, and 32.1% the year prior.
“After the record volumes of job postings during the second and third quarters of last year, there was the expected regression to the mean with employer hiring activity,” Herbert says. Big tech companies like Amazon, Salesforce, and Meta have attributed over-hiring as a factor in recent mass layoffs at the companies. Meta, which laid off 11,000 employees in November, announced last month it will terminate an additional 10,000 jobs and halt hiring for 5,000 open positions. In one of his latest pieces, my colleague Geoff Colvin poses the question: Are layoffs a confession of bad management?
Regarding tech in the financial services industry, Rob Alexander, CIO at Capital One, recently talked with me about the company’s hiring plans. “Our tech organization is actively recruiting for a range of positions, including engineering roles focused on cloud, data, machine learning, and cybersecurity, as well as product managers and technical program managers.” Alexander says that “machine learning, A.I., and real-time data are central to how we build our products and services for customers and to how we run our company.”
Meanwhile, insurance giant Prudential Financial is using A.I. to accelerate many individual life underwriting processes from 22 days to 22 seconds, and digital claims processing capability to deliver funds to most customers in six hours as opposed to six days.
The tech jobs of tomorrow, it seems, may look a lot like finance jobs.
Sheryl Estrada
sheryl.estrada@fortune.com
Big deal
Grant Thornton LLP, an audit, tax, and advisory firm, has released its 2023 Q1 CFO Survey, which found 54% of finance chiefs are optimistic or very optimistic about the economy. And more than two-thirds (68%) of CFOs projected a rise in net profits for their organization over the next 12 months, with a quarter predicting growth in the 6-10% range. Another key finding of the survey is respondents are gearing up for ESG (environmental, social, governance) reporting. More than one-fourth (27%) of CFOs said ESG disclosures will be one of the biggest challenges their business will face over the next six months. That’s more than double the percentage from the 2022 Q3 survey, according to Grant Thornton. Twenty-nine percent of CFOs said ESG is a fundamental consideration in their decisions, while an additional 44% said ESG is a moderate factor in decision-making. Just 9% don’t consider ESG at all, according to the survey.
Going deeper
“Generative A.I. Has an Intellectual Property Problem,” a report in Harvard Business Review, explores how the legal implications of using the technology are still unclear, particularly concerning copyright infringement, ownership of A.I.-generated works, and unlicensed content in training data. Companies that use generative A.I. must make sure they’re in compliance with the law and take steps to mitigate potential risks, according to the report.
Leaderboard
Linda LaGorga was named CFO at Entegris, Inc. (Nasdaq: ENTG), a supplier of materials and process solutions for the semiconductor industry, effective May 15. LaGorga succeeds Greg Graves, who recently announced his retirement after a more than 20-year career with Entegris. Graves will remain as special advisor to the CEO through July 7. LaGorga joins Entegris from Honeywell International Inc., where she most recently served as vice president and CFO of Honeywell’s $2.4 billion UOP business unit. Previously, she served as VP and CFO of the Honeywell aerospace mechanical systems and components business. From 2018 to 2021, LaGorga led Honeywell’s corporate FP&A organization.
Chris Murray was named CFO at Brightside Health, a telehealth platform that delivers mental health care. Murray will be responsible for the strategic and operational direction of Brightside Health’s finance function. He brings over 15 years of experience in roles across finance, operations, and go-to-market functions at health care and technology companies. Murray joins Brightside Health from Evolent Health, where he served as VP of finance. In his new role, he will oversee all accounting, finance, and tax functions, including financial planning and analysis.
Overheard
“You can never completely ban a product. There’s just so many ways to gain access that are beyond the control of the government.”
—Darrell West, a senior fellow in the Center for Technology Innovation at the Brookings Institution, a public policy think tank in Washington, D.C., told Fortune. As the Biden administration threatens to ban TikTok due to its ownership by China’s ByteDance, experts are explaining that Americans would not be entirely locked out of the popular social media platform if the app were banned.
This is the web version of CFO Daily, a newsletter on the trends and individuals shaping corporate finance. Sign up to get CFO Daily delivered free to your inbox.
