By Scott Wright

THE number of roles created by the key financial services sector in Scotland plunged by more than one 10 per cent in the last three months, as continued uncertainty around Brexit was compounded by the pandemic, new research has found.

The fall has led one Edinburgh-based recruitment expert to call for firms to be given more clarity on what to expect after Brexit, as those offering products designed for the European Union (EU) move operations and roles overseas.

Talks continue between London and Brussels over a trade deal between the UK and the EU as the clock ticks down towards the end of the transition period on December 31, with both sides warning there remain significant differences on key issues.

Major financial services companies such as Standard Life Aberdeen and Royal Bank of Scotland owner NatWest Group have ramped up their presence in the EU since 2016 to ensure they can continue to provide services to European member states after Brexit.

Core-Asset Consulting, which specialises in recruiting for financial and professional services roles, warned that roles being lost in Scotland due to Brexit are not being replaced.

It found 182 financial services jobs were created in Scotland between September 1 and November 30, compared with 204 over the same period last year. The sector employs more than 100,000 people directly in Scotland, with a similar number again in supply chain providers.

Founder Betsy Williamson said: “We need greater awareness of the day to day issues facing the financial sector right now. From our perspective, Scotland is struggling and losing more talent and roles than needs to be the case. Because it’s a service, it isn’t as tangible as the movement of goods, so the industry doesn’t get the same showing as fisheries, or physical import and export businesses.

“Yet roles working on EU-specific frameworks or products are leaving our shores without something there to replace them. It’s quite difficult to see it happening in front of our eyes.

“This isn’t about politics, or the rights or wrongs of Brexit. The time for that discussion has passed – it is now about plain economics. Giving businesses certainty to plan and people the confidence to stay and benefit our society and economy.

“Against a backdrop of Covid we can’t lose sight of the gargantuan changes that Brexit is bringing. We need policymakers to do their job, the main thing they’re paid to do, and make decisions.”

Core-Asset said it has access to insights from thousands of job candidates and leading recruiters in the financial services sector. It noted that it has been made of “unusual individual cases” in recent months, with talent stuck “in limbo” amid the upheaval sparked by Brexit and the implications of the pandemic.

Ms Williamson added: “We have numerous cases right now, where we have candidates from mainland Europe that we’ve placed in roles in Edinburgh. Their roles have now been relocated, often to Ireland, or back to the mainland.

“Yet because of Covid, they’re still here working from home. It doesn’t bode well longer term for Scotland unless it can be addressed by policymakers. We need these jobs here – they’re highly valued well remunerated – and therefore a big contributor to the local and national economy. At the start of the year, our annual salary guide pinpointed Brexit as the huge overriding issue the sector needed to face and adapt to.

“While Covid has jumped ahead in terms of urgency, the ramifications of Brexit are still playing out – and the picture is far too foggy as it stands. It’s impacting the health and prospects of a vital cog in the Scottish economy.”

Meanwhile, permanent job placements declined at the quickest pace for four months in November as companies suspended hiring because of tougher lockdown measures, while temporary billings rose sharply, the latest Royal Bank of Scotland Report on Jobs has found.

The report, published today, found that redundancies “reportedly drove a further robust” rise in candidate availability, although the rate of growth in the supply of permanent and temporary staff slowed from October.

Moves to cut back on expenses led to a “solid fall” in permanent salaries and a “slight dip” in average hourly pay rates for short-term staff, according to the report.

Sebastien Burnside, chief economist at Royal Bank of Scotland, said: “Tighter measures to limit the spread of coronavirus translated into tougher conditions for Scottish job seekers in November. Permanent staff placements declined at the quickest rate since July, with recruiters noting that some firms had once again put hiring plans on hold.

“Opportunities were harder to find as the number of permanent vacancies also fell sharply.”

“In the face of substantial uncertainty, firms have turned to short-term staff to fill roles, with temp billings rising sharply again amid a faster uptick in demand for short-term staff.

“Increasingly encouraging news on vaccines will give firms and workers hope that growth can get going again in a matter of months.”