Finance contractors in demand 'for next 3 years'

Financial recruitment experts are warning UK investment businesses are yet to work out who will help them implement regulations under the incoming Markets in Financial Instruments Directive.



A full cost-benefit analysis of the Directive, which will replace the existing Investment Services Directive, has not been taken, according to Project Partners, an agency for finance IT contractors.



From November 1 2007, when the directive comes into force, the agency is warning the UK's financial industry will face "significant human resource implications."



Chiefly, the agency says, this is because the legislation will require new procedures and IT systems to ensure the client company or organisation is complying with the rules spelt out under MiFID. In particular, the Directive ushers in new and more extensive requirements in terms of conduct of business and internal organisation.



Simon Walker, a director of the group who recently started a website to supply MiFID-savvy contractors and full-timers, claims his service will be one of the only resources helping the City comply.



"MiFID presents vast organisational challenges for investment firms across the EU and will have huge budget implications," he said.



"Firms will need to consider changes to their internal procedures and systems, creating significant implementation issues across the sector which could cost top-tier investment firms up to £100 million each."



Walker revealed that the directive will trigger "huge demand" for "business technologists that understand the operations of the investment community and have the IT knowledge required to implement the new systems."



PJ Di Giammarino, chief executive of JWG-IT, a think-tank for EU driven IT change in Financial Services, added: "The lengthy regulatory consultation process and imminent 2007 budget cycle could cause a shortage of professionals available to aid the implementation of the regulations."



He believes the shortage will be compounded as there are a number of UK-based programmes with similar personnel needs which "kick-off in the fourth quarter."



As a result, he predicts the demand from investment client companies "will outstrip the supply of qualified IT talent required to change the bank."



The market is therefore in need of "innovative solutions" to help find qualified people who have the "right background to deliver the changes which the regulators are looking for by 1st of November 2007," he said.



Walker expects demand for business technologists to peak in September this year. He predicts it will continue for the next three years as the investment community takes the necessary recruitment steps so "the implementation of the directive runs smoothly."



"Currently only 20 per cent of companies have allocated a budget for MiFID," he continued.



"This will change as the seriousness of the directive is realised and firms gear up to [the] implementation date."