Frankfurt’s banking sector is set to lose thousands of jobs as a result of the coronavirus pandemic even as it tries to attract bankers fleeing Brexit, a study said on Wednesday, October 21.
Frankfurt-based Helaba bank said that it expects there will be some 62,700 bank employees in Frankfurt at the end of 2022, down 2,000 or about 3% from before the outbreak of the pandemic early this year.
“For the German banking industry, the pandemic is another negative factor taking shape,” said Gertrud Traud, chief economist at Helaba.
Banking jobs in Frankfurt have continued to increase in recent years due to the growing need for staff to deal with regulatory issues, as well as the rise in employment linked to Brexit, the study said.
But digitalization, low interest rates, and now the “additional burden” of the pandemic will prompt inevitable job cuts in the sector.
Germany’s two largest private financial institutions – Deutsche Bank and Commerzbank – are pursuing thousands of job cuts as they shutter physical locations.
The report forecast around 2,000 positions will be created in the city from Britain’s leaving the European Union in January up to 2022.
But it said the influx of bankers who move to Frankfurt after Brexit would not make up for the loss of jobs expected due to the virus.
While the report said that banks in Europe’s largest economy would be able to absorb the damage from the pandemic, despite increasing loan defaults in 2021, risks in the medium term will remain high.
Frankfurt, a city of 700,000 on the Main river, had hoped to entice bankers from London put off by new restrictions on cross-border trade and travel post-Brexit.
However, while Frankfurt’s chief lobby group originally aimed to attract 10,000 bankers, estimates for new jobs are for around 3,500 in total between 2019 and 2022, according to Helaba. – Rappler.com
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