“Just Venmo me.” The app that makes transferring money easy as 1, 2, 3 is an example of how fintech has changed business as usual. The rapidly growing industry may be simplifying our lives and businesses, but fintech isn’t having an easy time finding skilled workers to hire.
Fintech encompasses any technology used for financial and business transactions from traditional banking and investment to cryptocurrency and algorithms/artificial intelligence.
The labor shortage for fintech comes down to two main reasons. There’s already a labor shortage for tech workers, and fewer recent college graduates want to work in the traditional financial sector, opting for startups and growth companies. On top of that, companies face intense competition for the small group of experienced fintech workers that are looking for work.
To lure top fintech employees, JPMorgan Chase posted a non-staid job description that said, “You care about disruption … . You have an opinion on Bitcoin and other cryptocurrencies, and you’re probably ambivalent about the prospect of working for a large financial institution.” JPMorgan Chase created a separate New Products Development Team with the freedom to experiment. The behemoth also has made strategic investments on blockchain startups.
Increasingly, organizations across the sectors will have to staff like technology companies — expanding hiring beyond an IT person or two. Already 40% of tech jobs fall into this category, according to Indeed, a job posting platform.
“As one of the largest industry sectors in the U.S. economy, technology continues to extend its reach in terms of employment and economic impact,” said Tim Herbert, senior vice president for research and market intelligence at CompTIA, a technology industry association.
In 2017, the U.S. had 2.8 million tech job openings with an increase of 194,000 postings over the previous year, according to CompTIA’s Cyberstate report. Compare this to the projected increase of 626,000 new tech jobs between 2016-2026, forecast by the U.S. Bureau of Labor Statistics. Add to that replacing retiring or career-change workers and the total tech openings could exceed 1.2 million jobs, according to the report.
“Whenever there are big changes in industry, the labor market lags behind because it takes years for workers to retool,” said Andrew Chamberlain, chief economist of Glassdoor, an employer-review and job-listing website. “In response to this skills shortage, we’ve seen ballooning in for-profit boot camps for tech, where in 12 weeks you learn to code, or learn statistical skills. But that’s not for everyone because you have to have some good math skills to start with.”
David Klapaak, director of program management for a Louisville, Kentucky-based tech company, points out that companies need to recognize the need to recruit, support, and train future tech employees. “… we’re not seeing a very strong mentoring population and program in a lot of businesses,” said Klapaak, who runs Interapt Skills. “… they simply say they don’t have any way to have a side-by-side learning environment for a student who’s coming out of our program, or a brand new junior developer who just went through our workforce development program.”
While there are no easy solutions, forward-thinking companies will implement Klapaak’s suggestions, and rethink their recruiting and onboarding programs to build their own fintech talent pipeline.