The financial sector is undergoing a skills revolution
In a bid to stave off a looming talent crunch, financial services firms have embraced skills-based hiring and redoubled their reskilling and upskilling efforts.
Faced with a worsening talent drought, financial institutions are increasingly turning to skills-based hiring to identify promising candidates. It’s about “will and skill, rather than degrees and pedigrees,” said Sagar Goel, Managing Director and Partner at Boston Consulting Group and Global Insights leader at BCG Henderson Institute, BCG’s strategy think tank. “That way, they are really expanding the pool of people they can attract,” he said.
A survey by talent assessment platform TestGorilla found that 87% of financial firms were already using skills-based hiring as of 2024.
At HSBC, for example, the Accelerating Wealth Programme “is all about hiring people with transferrable skills from different sectors and then teaching them banking skills,” said Lara Partridge, the bank’s Head of Talent Asia Pacific.
The bank is also implementing technology that can assess people’s skills to match them to jobs that they may not have even thought about, according to Partridge. “Soon, if you give us your CV, we’ll be able to skills-match you globally to roles that we have,” she said.
Gone will be the days of “figuring out your next job by going onto a career site and typing in the name of the job that you think you want,” said Partridge. Instead, algorithms will take care of that, potentially identifying options for a more fulfilling career — just like a streaming platform or social media algorithm might lead you to more personally engaging content than you might have found on your own.
Where’s the talent?
Talent shortages are now pervasive across roles and industries. A global survey by ManpowerGroup found that three-quarters of employers are having a hard time finding the talent they need (see Figure 1). A decade ago, only 36% said the same.
Two forces are driving this problem. The first is demographics. A rapidly aging global population means that “we are within one generation of not having enough people in the workforce almost everywhere except Sub-Saharan Africa and India,” said Partridge.
The second is an increasingly complex world. Against the backdrop of technological disruption, changing customer wants and needs, the intensifying urgency of sustainability concerns, and heightened geopolitical uncertainty, it will require more skills to perform just about any job effectively.
“You can’t do a HR role without a good understanding of ESG these days — the shifts are everywhere,” said Partridge.
As Mark Hoban, Chair of the UK’s Financial Services Skills Commission (FSSC), put it: “Whatever job you’re doing now, you will have to have a higher level of skill in the future.”
Within the financial services sector, there has been steady growth in the proportion of roles deemed high-skilled over the past 20 years, with a corresponding erosion of low- and medium-skilled roles (see Figure 2).
The consensus among the members of the FSSC, according to Hoban, is that there is now “a sweet spot for the ideal employee,” requiring “some level of tech skill, which varies depending on the role, as well as sector knowledge, and good behaviors.” (See Figure 3).
Investing in talent development
Getting to that sweet spot will require extensive investment in existing workers. Reskilling and upskilling is the main way financial services firms say they plan to improve talent availability, according to a wide-ranging survey by the World Economic Forum for its Future of Jobs Report 2025 (see Figure 4).
Those from non-finance backgrounds need to be brought up to speed on the required sector knowledge, those with technical skills may need help with their human skills, and those already demonstrating strong human skills can be turned into “winners” by receiving technical training.
Increasingly, this training will occur within the workplace. Rebecca Kellogg, Global Head of UBS University, the bank’s in-house learning and development institution, said that this will involve a shift in conceptions of learning.
“We often tend to think that learning is an isolated thing — I need to go learn that, I need to go do my training, I need to go read my book. But learning needs to be interwoven into how we effectively deliver our business,” she said.
This starts by making talent development integral to business strategy and culture, so that employees feel part of it.
“It’s the idea of being part of something versus something happening to you. The most effective organizations have leaders and employees who feel like they are part of something,” said Kellogg.
Hoban said that the industry is now providing a lot more targeted micro-learning courses in a blend of formats, including online and face-to-face, written content and media clips. He added that firms have also begun thinking more carefully about the effectiveness of learning.
“There’s a very clear sense that just measuring inputs on either hours or money spent on training is not a great proxy for the effectiveness,” he said.
It takes a village
Forward-thinking governments, too, have started playing their part in staving off a talent crunch in the financial services sector by supporting ambitious reskilling and upskilling initiatives. Goel highlighted the Technology in Finance Immersion Programme offered by the Institute of Banking and Finance Singapore, which “enrolls and reskills people from non-financial services backgrounds to take on IT or digital roles in banks,” said Goel.
“Following an intensive six-month program to learn, for instance, to become an AI engineer or data scientist, they are given an attachment with a bank to learn on the job. At the end of that, the bank can make them a permanent job offer,” he said.
“There’s no requirement to have a financial services background or a degree,” said Goel. It only matters that a prospective candidate has the base competencies and the willingness to learn. “That’s all you’re screening for,” he said.
Over 20 banks have come together to enable this program, creating the scale to make it effective. A bank seeking to go it alone with such an initiative might well find “it’s not scalable and too costly,” he said.
The industry is also coming together elsewhere to come up with ways to formulate and implement a skills-based approach more broadly.
Hoban’s deep dive into the issue began in 2018, when he was asked by the then UK Chancellor of the Exchequer, Philip Hammond, to lead a taskforce to determine the country’s financial services skills needs. The taskforce concluded that “the scale of the challenge was so huge that no one firm could by themselves solve this problem — the way to move forward was through collaboration and cooperation,” said Hoban.
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