OPPORTUNITIES IN FINANCIAL SERVICES

Find a Rich Career in Financial Services

With the United States presidential campaign now in the rearview mirror, we are about to get some strong indications of what a Trump presidency will actually mean for the economy of the country – and the world. The current level of economic uncertainty has some economists worried. The changing of presidents always produces some of this, but it is more magnified in this case – because Trump’s announced policies differ so much from those of the Obama Administration.

Still, no one expects the U.S. economy to tank suddenly or to grow exponentially. It does take time for Congress to enact any new policies, and then for the executive branch to implement them to any significant degree.

Economists believe the most likely scenario for 2017 is continued slow growth. They say that the economy might pick up toward the end of the year if Trump can implement his plans to replace much of the U.S. infrastructure.

In December 2016, pockets of some industries were going gangbusters, and the overall economic situation looked fair. Experts expected that the real gross domestic product (GDP) – a standard measure of the strength of the economy – would register a growth rate of 2.5 percent in 2016 and that business spending would be up by 6 percent. They expected housing starts to be up, and the unemployment rate to remain steady. Inflation would be up slightly.

Many economists predicted that 2017 will look a lot like 2016 – but with the unpredictability of a new president. Most of the economists surveyed by the National Association for Business Economics. in September 2016 forecast growth of only 1.5 percent over the next four quarters. Interesting to note:

■ Economists surveyed by NABE at the same point in the past four years expected growth between 2 percent and 3 percent, but the unpredictability of a new president made them more cautious this time around. Fifty-six percent of the economists believed that a Clinton presidency would be neutral for economic growth, while 60 percent believed that a Trump presidency would be unfavorable for growth.

■ They expected 1.19 million new housing units for 2016, and more than that in 2017.

■ Consumer spending would stay level. The economists expected growth of 2.7 percent in real personal consumption expenditures for 2016 and 2.6 percent growth in 2017. Both of those numbers are higher than they were when projected in early 2016.

Financial industry insiders are still cautiously optimistic about the hiring outlook for companies in that industry. Financial firms are likely to be on the lookout for fixed-income traders, along with players in the high-yield and distressed debt markets. Risk managers also will continue to be popular with recruiters in 2017, as firms remain sensitive to potential losses caused by market volatility and credit exposure. Other experts predict robust hiring on trading desks, particularly in the fixed-income, foreign exchange, and commodities markets.

In addition, huge Wall Street companies are hiring highly qualified college graduates very quickly, before even good-sized financial firms can get to those candidates. Such speed was not seen during the recession. Economists expect that a Trump presidency will be favorable toward Wall Street.

Some of the hottest careers right now include financial analysis manager, senior compliance analyst, and senior auditor. Accounting clerks and billing and collection staff are also still in demand.

WHAT YOU NEED

Workers in financial occupations usually have at least a four-year college degree. A bachelor’s degree in business administration or a liberal arts degree with business administration courses is suitable, as is a bachelor’s degree in any field followed by a master’s degree in business administration (MBA). A major or courses in finance, accounting, economics, marketing, or a related field serve as excellent preparation. Experience in sales also is very helpful.

Additional training may improve a worker’s chances of advancing to higher-level executive, administrative, managerial, and professional positions. Financial firms often provide opportunities for, and encourage employees to take, classes offered by banking and financial-management affiliated organizations or other educational institutions. Many classes deal with just one aspect of finance and banking, such as accounting management, budget management, corporate cash management, financial analysis, international banking, or data-processing systems procedures and management.

The financial industry depends heavily on technology, so an understanding of financial computer systems and software can greatly improve one’s advancement opportunities.

LOOKING AHEAD

According to projections in the Occupational Outlook Handbook, published by the Bureau of Labor Statistics (BLS), a part of the United States Department of Labor, wage and salary employment in the business and financial occupations will grow by 8 percent between 2014 and 2024, about as fast as all occupations. This will result in more than 632,000 new jobs. The median annual wage for business and financial occupations was $65,710 in 2015, much higher than the median annual wage for all occupations of $36,200.

The BLS expects the number of financial analysts to increase by 12 percent during the period from 2014 to 2024, faster than the average. Factors contributing to the growth will include the wide range of financial assets available for trade, the number of baby boomers (people born between about 1943 and 1960) reaching retirement age and therefore seeking advice on retirement options, and the globalization of securities markets.

The number of financial examiners will grow by about 10 percent during the decade from 2014 and 2024. Budget analysts are expected to increase at just 3 percent, which is slower than average. Personal financial advisors, however, are expected to increase by 30 percent, much faster than average. More than 73,000 personal financial advisors are expected to join the work force between 2014 and 2024.

FINANCIAL ANALYSTS

Financial analysts guide businesses and individuals in making investment decisions. They assess the performance of stocks, bonds, commodity contracts, and other types of investments. Financial analysts work for banks, insurance companies, mutual and pension funds, securities firms, the business media, and other businesses, making investment decisions or recommendations. The analysts study company financial statements and analyze commodity prices, sales, costs, expenses, and tax rates to determine a company’s value. They often meet with company officials to gain a better insight into the firm’s prospects and management.

Causes of the predicted growth will include increases in the complexity of investments, the global diversification of investments, and the amount of assets under management. As the number and type of mutual and hedge funds and the amount of assets invested in these funds increase, companies will need more financial analysts to research and recommend investments.

To become a financial analyst, a strong academic background is essential, including courses such as finance, accounting, and economics. A Chartered Financial Analyst (CFA) certification or a master’s degree in business or finance significantly improves an applicant’s prospects.

FINANCIAL MANAGERS

Almost every firm and government agency employs at least one financial manager. Duties include overseeing the preparation of financial reports, direct investment activities, and the implementation of cash management strategies. The duties vary with the managers’ specific titles, which include controller, treasurer or finance officer, credit manager, cash manager, risk and insurance manager, and manager of international banking.

Financial institutions such as commercial banks, savings and loan associations, credit unions, and mortgage and finance companies employ additional financial managers. Those personnel oversee functions that include lending, trusts, mortgages, and investments; and programs that include sales, operations, and electronic financial services. These managers may solicit business, authorize loans, and direct the investment of funds.

Financial managers play an important role in mergers, consolidations, and global expansion. Those areas require extensive specialized knowledge to reduce risks and maximize profit. Companies are increasingly hiring financial managers on a temporary basis to advise senior managers on such matters. In fact, some small firms contract out all of their accounting and financial functions.

A bachelor’s degree in finance, accounting, economics, or business administration is the minimum academic preparation for financial managers. Many employers now require graduates with a master’s degree, preferably in business administration, finance, or economics.

The BLS expects employment of financial managers to grow by 7 percent from 2014 to 2024, which is about average. Regulatory changes and the expansion and globalization of companies will increase the need for financial expertise and drive job growth. As the economy expands, both the growth of established companies and the creation of new businesses will spur demand for financial managers. The best news may be that most financial managers make more than $117,000 a year.

As with other managerial occupations, job seekers are likely to face competition; the number of job openings is expected to be less than the number of applicants. Candidates with expertise in accounting and finance, particularly those with a master’s degree or certification, should enjoy the best job prospects. An understanding of international finance, derivatives, and complex financial instruments is important. Excellent communication skills are essential because financial managers must explain and justify complex financial transactions.

Here is a directory of employers in the financial services industry that have proven their dedication to hiring veterans and a guide to understanding the financial services industry, job outlooks and opportunities.

Best of luck in your job search, and thank you for serving in the Armed Forces of the United States.


GLOSSARY

Auditors review financial records to make sure that the records are accurate.

CASL®, ChFC®, and CLU® are professional designations issued by the American College of Financial Services.

Commodities traders deal in contracts for bulk quantities of substances such as metals, crude oil and other energy sources, raw materials, agricultural products, and livestock and meat.

Compliance analysts work to ensure that their companies’ business practices comply with federal, state, and local regulations.

Data model. One definition is: A set of rules for defining and organizing data needed by business processes. A business commonly designs a data model before creating a database that uses the data.

Derivative is a financial instrument whose value depends on, or is derived from, one or more underlying assets. Examples of underlying assets include stocks, bonds, loans, currencies, and commodities.

Distressed-debt traders deal with bonds that are selling at a much lower price than the principal; investors say that such bonds are selling at much lower than “par value.”

Financial analysts guide businesses and individuals in making business decisions.

Fixed-income traders deal with investments such as bonds that provide a return as fixed payments of interest, followed by the return of the principal (the amount of the original investment) when the bond matures.

Foreign exchange (forex) traders deal in currencies of different countries, trading one currency for another – for example, trading United States dollars for Japanese yen.

Gross domestic product (GDP) is the output of goods and services produced by labor and property located in a particular place – for example, in the United States. GDP defined this way is also referred to as “nominal GDP,” to contrast it with “real GDP,” which is nominal GDP adjusted for inflation.

Hedge funds are private funds that are open to investors that meet certain regulations – depending on the type of fund, the investors can be “accredited investors,” “qualified clients,” or “qualified purchasers.”

High-yield traders deal with bonds that pay much higher interest than higher-quality bonds (called investment-grade bonds), but which have a relatively high risk of default.

Mutual fund is an investment vehicle that pools money from many investors to buy securities.

Risk managers evaluate and control business risks.

Securities include stocks, bonds, and derivatives of stocks and bonds.

Trading desk is a desk within an organization where securities are bought and sold.

Trust is a legal entity that holds assets for the benefit of a specific person, group of people, or organization.

Voice of the Customer (VOC). A perception of a customer’s needs and wants, determined by questioning the customer, analyzing how the customer presents itself to the public, and analyzing the customer’s activities.

By Jay Meyers on Monday December 12, 2016

This article appeared in the January-February 2017 issue of Search & Employ Magazine