GRS
www.grs.com
GRS News
Energy powers ahead as top banking talent jumps ship to bullet-proof sector
Downstream job placements in the energy sector have increased 35% in the City in the past year, according to executive search consultancy, GRS.
In the past year, downstream energy placements in risk, tax, legal and interim have increased 37%, 24%, 39% and 38%, respectively as the commodities sector has outperformed other markets and remained immune to turmoil in financial markets. Asset backed utilities have recorded bumper profits, fuelling acquisitions and leading to an increased focus on trading arms, which has resulted in a surge in recruitment in the sector.
Salaries in this market have risen 12% in the past year in response to demand. The average salary for middle office recruits in energy is now just under £90,000, with senior positions commanding base salaries of up to £380,000.
In addition, the success of the sector is being reflected in bonuses, which are expected to average 21% this year, which compares favourably with average bank bonuses for risk professionals.
Ken Brotherston, CEO of GRS, says that demand for professionals still can’t keep up with supply and that remuneration is reflecting this: ‘Trading firms are having to develop more advanced and robust risk systems to keep up with increased volume and volatility. As such, energy companies need the best talent there is and salaries are reflecting this. The pay gap between utilities and banks has closed significantly. This time last year, professionals working in banks earned around 18% more than their Energy contemporaries. That figure is now more like 7%. Top professionals working in energy are in an excellent bargaining position when it comes to remuneration. One particularly aggressive firm recently offered a team of energy traders almost 5 times the going rate to secure the best candidates; we've not seen risk staff benefit from quite the same multiples but with the profile of risk in all industries so high currently, the numbers are increasing at apace.’
Now able to offer strong bonuses and improved base salaries, energy companies are capitalising on the fallout from the financial crisis and, with ever increasing market consolidation, have been able to commandeer top European talent disillusioned with financial services. Professionals are fleeing the investment banks, which once offered safety and progression, for the sophisticated structures of the major utilities or the dynamic environment of smaller utilities trading houses.
Migration of firms to trading hubs across Europe has established a European common market and a highly interdependent trading environment. Nevertheless, London, along with Geneva, remains Europe’s oil trading hub, and London based offices are able to secure some of the most talented professionals in Europe.
David Butters of GRS said: ‘The imminent merger between EDF and British Energy is an example of the cross-border consolidation which is occurring in this sector – not dissimilar to the European investment banks market. Utilities companies now offer the same opportunities and prospects that banks did five years ago and I have seen a huge increase in the number of professionals coming from a banking background looking for placements within energy. The emergence of renewables and the ever changing environment make this not only a more stable sector, but also a hugely exciting one for candidates to enter into. Demand in this sector for good candidates will only continue to grow.’
