So far in our week-long series in partnership with City & Guilds in which we are marking National Apprenticeships Week 2014, we have looked at the Construction industry and the Business, IT & Customer Service sectors. In this part, we are going to take a look at the Finance industry, once again beginning with a high-level look, before going on to look more specifically to where employment is within the sector, and finishing off with a look at where we might expect to see future growth. Please note that this sector only includes Finance, but does not include Insurance activities, which can be viewed as a separate sector.
Overview of Finance
Though the period 2003-2013 as a whole has seen growth of 10% in the Finance sector in England and Wales, the graph below shows that this has not been linear growth by any means:
The major period of interest is 2007-2010, with the sector growing by almost 15% from 2007-2008, before sharply declining between 2008 and 2010. However, given the scale of turmoil in the global financial markets in this latter period, it is perhaps a little surprising that the decline did not completely undo the steep growth seen between 2007 and 2008.
Industries and Occupations
Within the Finance industry, there are only two “sub-categories”, as the following table shows:
Table: Specific Sectors (4-Digit SIC Level) Finance in 2013
|Description||2013 Jobs||Earnings Per Job|
|Source: EMSI Covered Employment - 2014.1|
|Financial service activities, except insurance and pension funding||453,550||£53,227|
|Activities auxiliary to financial services and insurance activities||404,948||£54,755|
The feature that stands out the most in this table is undoubtedly the salaries. The average salary throughout all industries in England and Wales in 2013 was just over £26,000, but as our data shows, the Finance industry far outstrips this figure, with an average annual salary of £53,948 — more than double the national average wage.
Although there are only two industry sectors within Finance, the number of different jobs within these two sectors is much higher, with a 18 occupation classifications altogether. The following table lists all of these occupations, starting with the one with the highest employment in 2013:
Table: Highest Employing Occupations within Finance in 2013
|Occupation||Employed in Industry Group (2013)||% of the Total Jobs in Industry Group (2013)||Median Hourly Earnings||Education Level|
|Source: EMSI Covered Employment - 2014.1|
|Bank and post office clerks||90,323||10.5%||£10.57||Level 2|
|Finance and investment analysts and advisers||89,629||10.4%||£18.20||Level 6|
|Financial institution managers and directors||64,232||7.5%||£25.15||Level 6|
|Financial managers and directors||47,765||5.6%||£26.75||Level 6|
|Financial accounts managers||38,773||4.5%||£18.72||Level 6|
|Business and financial project management professionals||28,506||3.3%||£21.40||Level 6|
|Financial administrative occupations n.e.c.||24,227||2.8%||£9.93||Level 2|
|Pensions and insurance clerks and assistants||23,105||2.7%||£12.02||Level 2|
|Customer service occupations n.e.c.||21,873||2.5%||£8.63||Level 2|
|Management consultants and business analysts||21,346||2.5%||£19.80||Level 6|
|Sales accounts and business development managers||19,637||2.3%||£19.90||Level 6|
|Other administrative occupations n.e.c.||19,460||2.3%||£9.51||Level 2|
|Programmers and software development professionals||19,451||2.3%||£19.66||Level 6|
|Chartered and certified accountants||17,685||2.1%||£19.87||Level 6|
|Customer service managers and supervisors||15,702||1.8%||£14.14||Level 3|
|Book-keepers, payroll managers and wages clerks||15,485||1.8%||£11.61||Level 2|
|Personal assistants and other secretaries||14,054||1.6%||£11.87||Level 2|
In contrast to the data we looked at yesterday relating to Business, IT & Customer Service, where most of the educational requirements in the top occupations were Level 1 or 2, most of the occupations within Finance require Level 6 qualifications (10 out of the 18 occupations). Having said this, there are also some lower level occupations, such as Bank and post office clerks and various administrative roles which require Level 2 qualifications.
In terms of numbers, Bank and post office clerks is the highest employment sector within Finance, with 90,323 employed in the industry in 2013, followed closely by Finance and investment analysts and advisers with 89,629.
Regional Variations in Finance
Looking at where the Finance jobs are in the country, we would expect the sector to be dominated by London. As the graph below shows, this dominance is not just a small matter — London employs 341,339 people in Finance, equating to almost 40% of the entire employment in this sector throughout England and Wales:
The Future of Finance
Although we already knew that London would be dominant in this sector — though we might not have known quite how dominant — what we wouldn’t have necessarily known is where to expect the highest growth over the next few years. The following graph shows which regions in England and Wales we should expect to see the major growth in terms of employment levels. It has to be said that some of these predictions are both interesting and surprising:
In terms of sheer numbers, yes London again comes out on top, with 22,000 more people expected to be employed in Finance in 2018 than in 2013. In terms of proportionate growth, however, the South West comes out easily on top with expected growth of 15%, followed by the West Midlands with 8%. With this in mind, colleges and those that offer apprenticeship schemes in these areas might do well to look into this in even more depth, in order to find out which Finance occupations are set to grow the most, so that they can take steps to meet this demand. As an aside, our Analyst tool has the capability to do just this — not only to find out which areas of the country are likely to see the most generic growth, but also to drill down and see where this growth is likely to happen within each area of the country, all the way down to local authority level.
Looking at growth from another angle, we can see from the table below which Finance occupations are likely to grow the most over the coming years:
Table: Top 10 Highest Growth Finance Occupations Over the Next Five Years
Occupation Employed in Industry Group (2013) Employed in Industry Group (2018) Change (2013 - 2018) % Change (2013 - 2018) % of the Total Jobs in Industry Group (2013) Education Level
Source: EMSI Covered Employment - 2014.1
Finance and investment analysts and advisers 89,629 97,713 8,084 9% 10.4% Level 6
Financial managers and directors 47,765 52,926 5,161 11% 5.6% Level 6
Brokers 32,496 35,481 2,985 9% 3.8% Level 6
Management consultants and business analysts 21,346 23,186 1,840 9% 2.5% Level 6
Business and financial project management professionals 28,506 30,196 1,690 6% 3.3% Level 6
Pensions and insurance clerks and assistants 23,105 24,745 1,640 7% 2.7% Level 2
Financial accounts managers 38,773 40,194 1,421 4% 4.5% Level 6
Chartered and certified accountants 17,685 19,026 1,341 8% 2.1% Level 6
Insurance underwriters 8,173 9,366 1,193 15% 1.0% Level 3
Business and related associate professionals n.e.c. 13,082 14,114 1,032 8% 1.5% Level 3
What is of real interest here is that the major growth areas are almost all in the high education level occupations, with Finance and investment analysts and advisers, Financial managers and directors and Brokers — all of which require Level 6 qualifications — set to see the most growth.
What have we learned from the data above? A number of things could be mentioned, but some of the most striking are:
- The average salary in the Finance industry is more than double the average wage in all other sectors in England and Wales.
- Most, though not all, of the jobs within the Finance sector require Level 6 qualifications.
- Though London is of course the major Finance region in England and Wales, other areas, perhaps not so readily associated with Finance, are set to see significant growth in this sector in the years to come.
EMSI and City & Guilds are working in partnership to deliver an innovative new service to FE Colleges. City & Guilds Advance provides colleges with a detailed labour market review, linked to their current curriculum and identify gaps in provision leading to a full quality review of key subject areas to address key Ofsted requirements. To find out more please visit the City & Guilds website.