Banks, fintechs, and everyone is else is emerging blinking into the sunlight after more than two years of Covid-19 restrictions, including tough isolation, home quarantine, and the sterility of life on Zoom. And while the Lion City is in a joyous mood, with its bars and restaurants roaring to life, for people in digital finance the world they are returning to is urgently short of the right kind of talent.
It is a truism that companies are always scrambling to keep and retain the best people. No matter the year, conference panelists inevitably complain of “talent wars” and CEOs blather on about how “people are our most important asset”.
This moment for Singapore is acute, however. “Digitalization will slow,” a COO at a global bank told DigFin. “Our inability to find the people we need is impacting what we can deliver.”
The US, Europe, India and Dubai have largely decided to treat Covid as another version of flu. But East Asia and Australia/New Zealand have been slow to follow. Singapore has been strict in its handling of the disease, but its leadership has taken the regional lead in protecting its healthcare system rather than trying to halt Covid’s spread.
That approach took a dramatic turn on Tuesday, April 26, when Singaporeans awoke to find most Covid-related impositions had been removed. Anyone commuting to work that day no longer needed the TraceTogether app mandated by the government to enter any building. The physical barriers to malls and MRT stations had been removed overnight. Visitors didn’t need a Covid test to enter the country. The only restriction left is a facemask requirement for indoors, but it is negated easily at a seat with a glass of water in hand.
Open for business
The bars and restaurants have been rammed since, in a spate of revenge-dining out. Many people are filtering back to offices. Business trips are being planned, while many global companies and events are descending on the city-state. People in fintech are bullish, even if some fret about the impact as some of the government’s Covid-related financial support is inevitably wound back.
Everyone, however, is struggling to hire the people they need to maintain the digitalization drive that Covid accelerated.
Bankers say they have already raised salaries for software coders by a third this year. “In the past,” the COO told DigFin, “for every 10 jobs we offered, nine were filled. Now it’s more like only three out of four.”
A consultant tells DigFin that competition is even harder for chief product officers: their salaries have risen by 50 percent to 60 percent this year, she says.
The challenge that banks and fintechs face is that digitalization is not just about financial services. They are competing now against manufacturers, telecom companies, government agencies, and other service industries, because the underlying requirements have converged.
Banks to blame?
For banks, another shift is that digitization means they need people integrated into the business. The old days of offshoring I.T. teams doesn’t work as well. One banker explained to DigFin that they need coders and business heads to work together, which is more difficult if the programming team is elsewhere.
Banks used to hiring big teams in-house also see a crunch coming. They are struggling to find entry-level people that could drink in the corporate culture and go on to become the next decade’s set of leaders.
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Some people in fintech are not sympathetic to banks, however. They believe people like the bank COO are a barrier.
“If I returned to my old bank,” an A.I. fintech founder told DigFin, “I would turn everything on its head and get rid of all those people. But that’s why they’d never invite me back.”
He notes that most CTOs and COOs are industry lifers who have no clue how to innovate. They are part of the process, whose perks and power derive from managing large and expensive teams. Software makes many of these jobs redundant – even within a compliance-focused organization.
One head of wealth management told DigFin her department also struggled to attract tech talent. The only way to change that dynamic is to come out of Covid with real commitment to transformation. “Staffing is hard, but a project will draw people if it’s new and exciting,” she said. “No one’s interested in running legacy architecture.”
Finding programmers is hard everywhere; this is a global, cross-industry trend. Singapore’s environment is especially challenging for two reasons.
First, it is the first East Asian nation to emerge from Covid restrictions. It is assuming the mantle of regional leadership as Hong Kong remains snared in zero-Covid policies, and also as Hong Kong’s business environment pivots more to integration with mainland China.
Therefore there are more fintech companies as well as department heads at banks moving to Singapore, or looking to use the city-state as a springboard. And they are naturally the tip of the hiring spear.
But Singapore is also a challenging environment because of the government’s visa laws. The country has lost a chunk of its expat professionals. During Covid, Singapore did not guarantee foreign residents could reenter if they left to visit family abroad. This put many people in a bind, and some left; others were deported if they broke Covid-related rules.
It’s straightforward to set up a new business in Singapore if it promises local hires, and senior foreigners have no trouble getting a work visa. But the government is slow to provide visas to junior staff, as it wants to give locals a crack at those jobs, including programming.
For such people – from India, China, Eastern Europe – a job in Singapore might have been regarded as a stepping stone to working in London or New York, but demand is high worldwide so they may find it easier to obtain a work visa in Western capitals.
Businesspeople tell DigFin that few locals want to be coders, however. Between some lost expat talent and the lack of local supply, hiring in Singapore has become very difficult – at a time when demand is surging. The Monetary Authority of Singapore, DigFin is told, is in a tight spot, as it wants to help the finance and fintech industry – but it has little sway over labor laws or government immigration policy.
This is ultimately a success story for Singapore, which during Covid has extended its attractiveness as a fintech hub. After a grueling two years of lockdowns – often far tougher than those in Hong Kong, shielded for a time behind its quarantines – the Lion City is now throwing open the gates. But not to everyone. As live, international events return to Singapore, expect the stage to be given over to tales of hiring woes.