Students walk around York University Keele campus, Toronto January 8, 2014.Fernando Morales/The Globe and Mail
Canadian banks are gaining in the race to attract the top young talent needed to build the next wave of financial technology, a new survey shows.
More than 20,000 business and engineering students from more than 200 postsecondary schools across the country weighed in with their perceptions of the pay, advancement opportunities, reputation and image of major companies from coast to coast. And while big-name global tech giants still garner attention, skilled students are increasingly considering life at a lender.
"A lot of banks are really trying to emerge as technological leaders," said Jason Kipps, managing director at Universum Canada, an employer branding firm that conducted the annual survey. "Some of them are doing massive hiring. Some of them are building new spaces that are more creative and dynamic – more consistent with an agile startup tech company."
As the country's biggest banks fend off the advances of financial technology startups that are seeking to simplify financial transactions and improve the ease of retail investing, many have been investing in building up their own digital teams.
That strategy is resonating with the next generation of employees currently studying science, technology, engineering and math, or STEM. Among engineering and information technology students, Toronto-Dominion Bank was the top-ranked lender, coming in at No. 59 on the top 100 list. That is still far from the top, but a vast improvement over being ranked No. 97 last year. Other banks to crack the top 100 were Royal Bank of Canada and Bank of Montreal. U.S. investment bank Goldman Sachs and JP Morgan also made the list.
The research aims to rank employers on their appeal to future candidates, showing how businesses stack up compared with other firms competing for top talent.
Mr. Kipps said banks are aware that some talented students are passing over them. "Last year, only 3 per cent of Canadian students in engineering and IT-related programs even considered working in [financial institutions]," he said. But that increased to close to 10 per cent in 2016.
Alongside the tussle between old-school financial firms and technology upstarts, other economic conditions have pushed more talent toward banks. Fewer STEM students are seeking careers in the energy sector, which has been grappling with depressed commodity prices.
Financial firms are also rethinking where the most talented young employees can be found, Mr. Kipps said. That includes comparing their attractiveness to companies such as Ubisoft Entertainment SA, Microsoft Canada Co. and other tech startups, rather than just to others in their own industry.
"Historically, they set the bar way too low" for whether they were succeeding in the war for talent, Mr. Kipps said of the banks. He has also seen lenders crack down on legacy hiring practices that showed favouritism for schools attended by senior leaders in the company.
Some banks have pointed to large Silicon Valley tech companies as possible future competitors. With Apple Pay hitting campuses and a sister company of Google Inc. providing venture capital funding to some fintech startups, it's no surprise that these companies are among the most-sought employers.
These companies still outrank working for a Canadian bank by a wide margin on the attractiveness scale, with Google being the most appealing employer for both business and commerce students, as well as the engineering and IT crowd.
Not only are banks changing, but the the young workers they are trying to attract have evolving interests in what they want from their employers. Mr. Kipps said the amount of time students expect to stay with their first employer has been steadily increasing over the last three years to the average of five years reported in the survey.
But despite the uncertain economic environment, hallmarks of stability such as health benefits and a high base salary are still taking a back seat to qualities such as the ability to advance and achieve work-life balance.