Cardiff has an ambition to become recognised globally for its expertise in specialist areas including risk management, support for businesses requiring low-latency telecoms, and outsourced legal services and compliance. Deloitte have chosen to base their global risk centre of excellence in the heart of the city centre, whilst others, including Atradius the credit risk insurers, are already firmly established in Cardiff having based their UK and Ireland operations in the capital. Wayne Harvey, Senior Partner, Deloitte Wales said “A major factor in our decision to base our fast growing delivery centre in Cardiff was the vitality of the talent pool, the accessibility to London and the enthusiasm of the Welsh Government and City Council – we are very pleased with the outcome.”
Why have these firms centred resource outside of London? The benefits of Cardiff in financial terms are clear; wages are 70% of those for similar roles in London i, and Grade A office space is available at 40% less than the equivalent offering in London ii. Cardiff is now one of six cities in the UK with an internet exchange which provides data-heavy companies with world-class resilience.
This forward-thinking approach has seen Cardiff make significant investment in its infrastructure. With the demand for high quality office space forecast to rise, over 700,000 square feet of Grade A accommodation across a number of desirable city centre locations will be available over the next few years.
Coupled with the £1billion investment in rail electrification, the Cardiff to Canary Wharf commute will be under two hours by 2018, making the Cardiff Capital Region one of the top nearshoring options for London-based businesses.
Welsh Government Economy Minister Edwina Hart said: “We have serious ambitions to make Cardiff the most competitive UK city outside London for the financial and professional services sector and aim to ensure the city becomes the international location of choice for businesses in this sector. The latest official figures for inward investment clearly illustrate our policies and strategies are paying dividends. In the last financial year we recorded our best ever figures – with more than 5000 new jobs forecast across all sectors. Over 2000 of those new jobs are in the financial and professional services sector which is a significant proportion.”
For professionals making the move, the quality of life that Wales has to offer is a big draw. The cost of living is around 20% lower than the UK average iii, and a staggering 40% lower than London iv. Many professionals are finding that for the first time, executive home ownership is a reality. Cardiff consistently ranks as the number one city for workforce loyalty and quality of life in the UK v, with staff turnover at just 5%; significantly lower than its closest rival at 12%vi.
Personal and emotional factors also play a contributory part to a number of professional decisions to move. Factors such as a closer proximity to family, less commuting time, reduced pace of living, avoidance of feeling claustrophobic, more time to socialise and involvement in a range of outdoor pursuits.
Graduating from university and embarking on a career in London is a well-trodden path for many ambitious professionals. The desire to now stay in Wales is seen in the number of graduates from Cardiff’s three world class universities who stay on in the city rather than move outside the region. Cardiff boasts more F&PS graduates per capita than any other major city in the UK.
In addition to this academic provision, pioneering schemes such as the Welsh Financial Services Graduate Programme, developed in conjunction with Admiral, Legal and General, Atradius and other like-minded businesses, are ensuring Cardiff has a wide pool of skilled graduates locally to recruit from.
Alun Sweeney, Director, Atradius UK & Ireland said “These young people are the leaders of the future and Atradius is privileged to be playing a part in shaping their development. The graduate programme which has been developed in close conjunction with the Welsh Assembly government in Cardiff, harnesses the energy and ambition of young people taking their first steps on a career path. When you put that side by side with the knowledge, skills and experience that Cardiff based employers can offer, it is a winning combination and assures a positive future for financial services in Wales as a whole”
Not surprisingly, all of these factors combined and the world-class sports, cultural and entertainment facilities right in the heart of the capital, has started to result in many specialist professionals choosing to pursue their career in South Wales.
Rhiannon Williams, Human Resources Director, Target Group said “Cardiff is a growing and vibrant centre for financial services, and at Target Group we are committed to creating roles for exceptional talent in this sector. It is important that the UK has strong financial centres other than London, which offer high profile specialist roles, and in our opinion, South Wales is the perfect place to do just that”.
With their deep expertise, broad network and strong regional presence across South Wales, South West and The Midlands, Seymour John has formed strong working partnerships with many Cardiff based companies over the past few years.
The recruitment market has changed enormously over this time and a number of their customers have adapted to this new candidate driven landscape by tailoring their approach to prospective talent, both on permanent and interim or temporary resource, alongside the support and guidance of Seymour John.
Within the Financial Services arena, the increased regulatory requirements, coupled with deeper scrutiny and a desire to raise standards, in risk management for example, have had a significant impact, particularly in relation to Compliance, Conduct, Credit Risk, ALM and more recently Information Security and Cybercrime.
Emlyn John, Director at Seymour John commented that his team are “continually assessing and improving its techniques to talent acquisition and management, so that candidates with technical Financial Reporting, Compliance, Risk, Audit and Treasury skills, are consulted through proper engagement on behalf of their customers”.
Seymour John help their customers’ bridge skills gaps through interim or temporary resource. Many have a growing acceptance of the role that interims can play, often as ‘change agents’, utilising the experience gained in larger institutions for the benefit of regional players. Within the Financial Services industry, whilst regulators will always focus on key person dependency and succession planning, there is a degree of pragmatism being shown, recognising that skills transfer is an essential way to raise standards. This is not a long term sustainable model for a stable location and businesses are continuing to train existing permanent staff as much as possible and develop skills and knowledge accordingly.
Businesses need to think differently about working patterns to attract the right talent to their business, offering individuals in certain specialist roles greater flexibility to be able to work from home for a significant proportion of the working week. This will be made easier by the GWR electrification and means that regionally based companies could attract talent without the need for ‘migration’, so those based in London and South East could work for a business in South Wales, without relocating permanently.
Despite the benefits of establishing their operations in or near to Cardiff, providing employees to achieve a lifestyle balance, there are still some limitations for upward career development and in some businesses competition is stiff. Finance professionals in particular are still concerned by this aspect.
Sustainability needs to be built upon long term commitment and investment to infrastructure, employees and senior management being based in the regions, before the market can be described as buoyant. It is not enough to offer cost efficient alternatives; skills, knowledge and services need to be developed as centres of excellence to continue to provide the impetus for investment.
Ed Paulat, Managing Director, GMAC UK said “Cardiff is an exceptional UK location with an attractive, expanding, financial business community. GMAC is playing a leading role in this expansion through initiatives such as the Wales Financial Services Graduate scheme and the Welsh Financial Services Employer board. Although I believe Cardiff is the perfect place to be, there will always be challenge in competing with London. We want to see Wales established as a centre of excellence for Financial Services. If we can focus on this then we’ll be able to attract the right calibre of candidates to deliver for the region”.
For further discussion or comment on either this topic or any others affecting the South Wales market, please contact Maria Edwards
Sources for statistics are referenced below.
i Office for National Statistics, 2015 ii BNP Paribas Real Estate, 2014 iii Key Retirement Solutions, 2013 iv Expatistan Cost of Living Index, 2014 v Legal and General UK Today: Best City to be Young Report, 2013; European Commission Quality of life in European Cities report, 2014; Moneysupermarket Annual Quality of Life Index, 2014.
vi Income Data Services, 2013