The global decline of financial service jobs in the United Kingdom has reached a new tipping point following last month’s Brexit vote that places the country on a path towards secession with the EU. Big banks, already reeling with diving profit margins and declining revenues, were amongst the hardest hit, specifically in markets, as uncertainty is ratcheted up in premier financial centers such as London.
For its part, RBS has been one of the more active players in the personnel scene during the past six months, jettisoning hundreds of workers from the UK. While not on the same level as Deutsche Bank or Barclays’ ambitious retail strategy shifts that portend the outflow of up to 35,000 workers over the next few years, RBS has led a more targeted exodus, culminating in 5% of its UK workforce over the past four months alone.
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Fear and uncertainty in the fallout of the vote do not appear to have triggered a knee jerk reaction in personnel cuts however. According to RBS Chief Executive Ross McEwan, the group may instead opt to move ‘tens’ of employees rather than any broader strokes in its workforce. This is contingent upon an eventual UK split with the EU, which would effectively abolish passporting rights for financial service providers.
“One of the key things for me is holding on to passporting so that European banks and British banks can operate across without any boundaries. If we don’t get the passporting it is inevitable that some jobs will disappear” noted Mr. McEwan in a recent interview with radio station LBC.
For now, the ball remains in the UK’s court as leadership shakeups and a staunch backlash against the vote last month shows a certain reticence regarding a formal EU schism, which would no doubt have major ramifications on the banking industry in either scenario.