In the competitive world of financial services, the traditional recruitment process often favours candidates with polished CVs and prestigious educational backgrounds.
This approach can inadvertently overlook a vast pool of talent that may lack conventional qualifications but possess the essential skills needed for success.
In turn, this omission in recruitment has led to a diversity gap that the industry is still struggling to tackle.
Diversity gap in finance
To highlight the disparity caused by this gap, research from PWC UK in 2020/21 showed that the top five gender pay gaps by sector were all within financial services.
It reported the average pay gap stood at 26.6 per cent for the financial services market, which was significantly above the 12.1 per cent for the wider UK market.
Further, a report by the City of London and consultancy the Bridge Group in 2020 found that 89 per cent of senior level staff in financial services hailed from professional backgrounds, in contrast to 52 per cent of chief executives across the UK and 37 per cent of the overall working population.
These statistics paint a stark picture of the diversity challenges facing the financial sector.
Addressing these disparities requires innovative approaches to recruitment and assessment, which is where practical learning technology comes into play.
My journey and the need for change
Personally, I struggled with my own learning challenges as a dyslexic student.
I found traditional teaching methods challenging, and theoretical concepts often felt abstract and unengaging.
However, my practical skills shone brightly when I was on a trading floor, giving me a hands-on learning experience where I thrived.
This personal experience highlighted to me a significant gap between theory and practice in the financial sector’s recruitment process.
Recognising this gap, I co-founded AmplifyME to create a more inclusive pathway into financial services.
Our platform uses simulations that replicate real-world trading and asset management environments, allowing candidates to showcase their skills in a practical context.
This approach ensures that individuals are assessed based on their abilities, not just their academic credentials or resumes.
The evolution of recruitment
Over the past decade, I have witnessed significant changes in how financial institutions recruit top talent, driven largely by the integration of technology.
Practical learning simulations, for instance, provide an immersive experience where candidates can engage directly with market activities, gaining a practical understanding of market dynamics.
This method helps bridge the gap between academic knowledge and real-world application.
We are now beginning to see more and more financial institutions looking to leverage these simulations as part of their recruitment processes.
For example, in 2023 40 per cent of Morgan Stanley's EMEA sales and trading interns were candidates being trained through practical simulations.
This success story underscores the effectiveness of practical learning in uncovering diverse talent.
The age of AI
The emergence of AI is now further exposing how conventional recruitment methods are riddled with limitations.
For instance, CV screenings often focus on qualifications and experience without delving into practical skills, whereas interview-based assessments can be subjective and may not fully capture a candidate's ability to handle real-world challenges.
