Good morning.
Right now, in an uncertain economy, a career in finance looks good to many Gen Zers who may want to make sure their bills are paid and still have a personal travel budget.
The 2023 Global Graduate Outlook Survey, released by the CFA Institute, a global nonprofit association of investment professionals, found that among almost 10,000 current university students and recent graduates, 24% considered finance to offer the best career prospects—a 9% increase from CFA’s 2021 survey. Finance rose in the ranks from fifth place, replacing education at the top spot.
The findings are based on a global survey of 9,437 respondents age 18 to 25 who are studying for a bachelor’s degree or higher, or who have graduated with a bachelor’s or higher within the last three years. They represent 13 key global markets including North America, Europe, Brazil, and India.
Post-pandemic, finance is considered the most stable career, followed by STEM (science, technology, engineering, and mathematics), both up from 2021, according to the report. Meanwhile, graduates say their greatest fear is low pay, and more than half (62%) say a good salary is important in an employer.
‘A shift in mindset to now seek younger generations’
The banking industry, in particular, has struggled for a long time to attract younger employees, and the preference has been to hire experienced individuals, according to a recent survey from Crowe LLP, an accounting and consulting firm with a financial services practice.
“There has been a shift in mindset to now seek younger generations to fill these positions to increase technical proficiency and bring more diversity to the position,” Crowe’s research found. In 2022, the average salary increase for nonofficers was 5%, an increase from 3.4% in 2021. The increase surpassed the 2022 projection of 3.1%, which is expected to increase to 3.8% in 2023. The findings are based on a survey of 429 financial services organizations representing a cross-section of the industry by geographic location and asset size up to $10 billion, with some banks well above $10 billion.
The Association for Financial Professionals compensation report released in May found that treasury and finance professionals realized a 5% increase in their 2022 base salaries. Management-level employees, like FP&A, had the largest bump, at 5.3%, followed by executives, 5%, and staff, 4.8%, according to a survey of 1,408 financial professionals.
Although more Gen Zers are turning toward the finance industry, most graduates say they don’t intend to stay in their first jobs longer than four years, with 37% saying they’ll stay only one or two years, according to the CFA Institute’s survey.
Another finding: 91% of graduates say they want to make a positive social or environmental contribution through their careers, naming health care, science, teaching, and nonprofit as the most promising sectors for that. An improving economy could see more recent graduates make the switch even sooner.
I recently spoke with CPA Barbara M. Porco, a clinical professor and associate dean of graduate studies in the Gabelli School of Business at Fordham University, who said she’s preparing her students to understand the connection between finance and accounting and ESG. From freshman year through MBA programs, ESG literacy is infused into the curriculum, Porco told me.
“You’re creating not only an awareness of ESG through the SDGs [sustainable development goals], but you tie it in at the end with ESG reporting and disclosures, and suddenly now, you know what—accounting might be interesting,” she said. “Students may begin to think: ‘So you mean to tell me that if I go into the accounting profession, I need to understand environmental and social issues?’”
Getting students and recent graduates interested in finance is only the first step. Companies must then keep them interested.
Sheryl Estrada
sheryl.estrada@fortune.com
Big deal
PwC's 2023 U.S. Risk Perspectives Survey finds that risk professionals are gaining increasing influence, though not consistently. When it comes to company initiatives such as enterprise tech investments, entering new markets, deals, new product development, cloud migration, and new business models, just about half of the risk professionals surveyed said they're becoming involved during the initial strategy or design stages. "As for the rest, they may get a seat at the table, but they arrive too late to influence strategy and design," according to PwC.
Some respondents are seeing “significant improvement” in how they manage risks from their use of tech applications such as advanced analytics (56%), automated workflow solutions (51%), and A.I./machine learning (48%). About half of risk professionals said they’re seeing better decisions based on risk insights, prioritization of risk mitigation efforts, identification of new risks, and detection of threats in real time. However, fewer said they’re seeing significant “efficiency” outcomes such as lower compliance costs (30%) and personnel costs (25%). The findings are based on a survey of 308 professionals in risk, including audit, and compliance, from U.S. companies with revenues exceeding $1 billion.
Going deeper
Global growth is projected to decelerate from 3.1% in 2022 to 2.1% in 2023, and the risk of financial stress in emerging market and developing economies (EMDEs) is intensifying, according to the World Bank’s latest Global Economic Prospects report. In EMDEs other than China, growth is set to slow to 2.9% this year from 4.1% last year.
"In 2023, trade will grow at less than a third of its pace in the years before the pandemic," Indermit Gill, the World Bank Group’s chief economist and SVP, said in a statement. "In emerging markets and developing economies, debt pressures are growing due to higher interest rates. Fiscal weaknesses have already tipped many low-income countries into debt distress. Meanwhile, the financing needs to achieve the sustainable development goals are far greater than even the most optimistic projections of private investment.”
Leaderboard
John Redett was promoted to CFO and head of corporate strategy at Carlyle (Nasdaq: CG), a global investment firm, effective Oct. 1. Redett succeeds Curt Buser, CFO at Carlyle since 2014, who has decided to retire from the firm effective at the end of the year. Buser will step down on Sept. 30, 2023, and will become a senior advisor until his retirement. Redett joined Carlyle in 2007 as an investor on the Global Financial Services team. He has served as the sole head of global financial services since 2020 and was the cohead of global financial services from 2016-2020. Redett is a 25-year veteran of the financial services industry. He has led or been a key contributor to some of Carlyle’s significant investments across various subsectors of financial services, including Duff & Phelps, TCW, BankUnited, Hilb Group, EPIC, DBRS, Central Pacific Bank, CFGI, Sedgwick, PIB Group and JenCap. Before joining Carlyle, Mr. Redett worked at Goldman Sachs from 2005-2007, and JPMorgan from 2000-2005.
Chris Suh was named CFO at Visa (NYSE: V) and will serve as CFO designate from July 10 until Aug. 1, when he will assume full responsibility for the role. Suh succeeds longstanding Visa CFO Vasant Prabhu. As previously announced, Prabhu will depart the company on Sept. 30, after a transition period. Suh joins Visa from Electronic Arts (EA), where he held the role of CFO. He will report to Visa chief executive officer Ryan McInerney and sit on the company’s global leadership team. Before EA, Suh was the corporate VP and CFO of the Cloud + A.I. group at Microsoft, where he oversaw the rapid growth and transformation of the Azure and Dynamics businesses. During his more than 25-year tenure at Microsoft, Suh served in a variety of senior finance roles, including five years leading investor relations.
Overheard
“We will bring in top talent from across the industry to achieve these goals. Our hope and aim is to welcome back some former Slack employees among these new hires whose skill sets can help us move this exciting work forward. I can’t wait to see what we can accomplish together in FY24!”
—Slack CEO Lidiane Jones announced in a note to staff on Tuesday that the company is looking to hire for a “significant number of new roles” in Q3 on the product development engineer team, Fortune reported. The move to rehire to fuel the company's generative A.I. ambitions comes less than six months after Slack, parent company Salesforce, laid off 10% of its staff, about 8,000 people, in Q1 of this year.
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