Shifting Priorities: How Candidates are Prioritising Immediate Gains over Long-Term Careers in 2022
02 February 2023

Things were looking up for the World, but then Russia invaded Ukraine in the first quarter of the year. Despite the global uncertainty, 2022 was a successful year for Luxembourg recruitment in the financial services and legal sectors.

Here, we take a look at how the Coronavirus pandemic and global situation affected recruitment – from both the perspective of employers and job seekers.

Overall Worker Demands Were Up

With growth, increased regulation and turnover of staff, all industries have needed new hires. This shows that there is a demand for new and qualified employees in every sector.

The most notable hiring trend in 2022 was in compliance, risk and finance where there is a talent shortage.

Candidate Shortage

Luxembourg has been facing a major candidate shortage for many years, leading to an increase in wages for sought-after talent. In some cases, employers have raised salaries as much as 25% to secure the right employee for the job.

This has led to some candidates being able to negotiate their salary upwards of 15% when going for an internal promotion or taking on more responsibility. Moreover, candidates are now more inclined to take on jobs that offer immediate gains over long-term opportunities, as it allows them to make more money in a shorter period of time.

Salary negotiation is not always easy but it can be done if there is strong evidence to back up their demands. This involves having data on how much other people are paid at the same level, what the individual has done in comparison (in terms of achievements), and what the expectations are and is it fair based on those things.

The legacy of Brexit has resulted in significantly less employee resources from the UK. A steady flow of candidates coming from the UK was always readily available. However, with added red tape of work permits etc, we have seen a drop in relocation from the UK (if they are not already relocating with their current employer).

Remote Working Are on Demand

Since the working from home option that covid brought into our lives, candidates are now asking about how much flexibility is available to them. This is now a major factor for candidates since covid and something we see our clients trying to offer as best as possible.

Candidates want more flexibility in their life and they want employers who will be flexible with them. If you’re not offering it, this can hurt your chances of hiring new talent in the future.

Working from home policies and flexible working is now one of the top questions nearly all candidates ask about potential future employers.

AML/KYC Sectors Dynamics

Compliance positions saw the largest spike in salary, especially for Anti-Money Laundering/Know-Your-Customer (AML/KYC) officers. With recent regulations from the Commission de Surveillance du Secteur Financier (CSSF), companies are in need of experienced professionals to help them follow these guidelines. Risk Officers were also in high demand for well-paying jobs, followed by those that involve finance.

The average salary for Compliance Officers is €80,000 in 2022. The salary has been increasing steadily over the years, but this year saw an increase of averagely 15%.

Obviously, Compliance Managers can demand significantly higher and if they are conducting officers or the RC, then even more again. It is very apparent companies are struggling to recruit qualified staff with the increasing regulation.

Accountant Sector

Accountants are a large part of the Financial Services workforce and those with ACCA qualifications (or equivalent) can get a very competitive salary. Due to a shortage in qualified candidates, Redbridge Recruitment opened an office in Bucharest in 2021, allowing them to access a larger pool of part-qualified and ACCA qualified accountants who are bilingual or multilingual and willing to relocate. Many of our clients have benefitted from this initiative.

Busy Legal Market

In the Law Firms there was a great demand in Investment Funds, Corporate Mergers & Acquisitions and Taxation departments. Similar to other sectors, lawyers are in high demand and we see a talent shortage here too. More law firms have opened offices in Luxembourg over the past few years and the search for Associates; especially those who are bordering on becoming a Senior Associate; is rife.

The Search for the More Affordable Worker

We’ve already seen clients (such as asset managers) recruit their accountants and finance staff in London rather than Luxembourg because they can get the same quality at a lower cost.

Often, many of clients can choose where they want to hire an employee and due to substance reasons, Luxembourg has often won that battle. However, 2022 was the first year for a long time that we have seen our clients actually choose London or another location due to the cost and quality and quantity of the workforce.

It will be interesting see what happens for the upcoming year!

Final Thoughts

For generations, having a successful career has always been vital. Candidates should give careful thought to how their resume looks and think ahead to the medium- and long-term possibilities they can create in the first decade of their working life. Making careful decisions now can set the groundwork for success down the road.

2022 marked a distinct change in attitude towards personal career growth. Rather than prioritising gradual progression and job stability, candidates are now opting to move to new employers after just 6 months in order to increase their salary or receive other incentives. The result of this is higher staff turnover as well as increasing salary costs for employers, neither of which are beneficial. There is no indication that these trends will be slowing down any time soon, with further indexations for 2023 on the horizon.

The result of a higher salary for an employee can mean that they may not be adequately skilled to handle the job that the employer is expecting them to do. This can lead to stress and, eventually, another job-hopping situation in pursuit of yet another higher salary.

Having an open dialogue with our job seekers is something we highly value. We want them to consider the long-term effects of changing jobs and potentially settling into a more secure role. That being said, it can often be difficult for individuals to pass up a higher-paying job offer, without considering its potential consequences down the line.

To get a better idea of what your future could look like if you take that kind of job, be sure to check out our 2023 forecast!

Article written by Richard Neale, January 2023