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Worrying financial services jobs cull only just begun

The jobs cull in financial services, which has seen 6,000 people lose their jobs over the past 18 months, is only just beginning.

By the time the dust has settled, tens of thousands more well-paid financial sector jobs will have disappeared.

This week, credit card company MBNA announced that it was laying off 66 staff at Carrick-on-Shannon in Co Leitrim.

It won't come as any consolation to those who lost their jobs this week that they were not alone, with banking union IBOA estimating that 6,000 financial services jobs have been lost over the past 18 months.

That's one in 10 of all financial services jobs.

And the bad news is that there is almost certainly more, far more, jobs to go in the sector.


The IBOA itself reckons that a further 4,000 jobs will disappear in the next six months.

While I hate to be the bearer of bad tidings, the job losses are unlikely to stop there.

The Irish financial services sector, which at its mid-2007 peak employed almost 60,000 people at an average wage of almost €900 per week, is rapidly disappearing before our eyes.

Halifax has already exited the Irish market, NIB has closed half its branches, both AIB and Bank of Ireland have announced large lay-offs, while the administrators have laid off 900 people at Quinn Insurance.

These job losses are only the beginning. Both AIB and Bank of Ireland are expected to announce further hefty job losses shortly, several foreign-owned banks are likely to follow Halifax out of the Irish market altogether, while RSA's bid to take over Aviva makes further large losses of insurance jobs virtually inevitable.

So where will it all end? The answer is that no-one knows for sure.

What is certain is that the jobs shake-out in financial services has only just begun and that the financial services sector that eventually emerges from the bust some time around the middle of this decade will be much, much smaller than it was in 2007.


Even more worrying is that those who keep their jobs are likely to see their pay, once among the highest in the private sector, slashed.

So how many more financial services sector jobs are likely to go? As things stand, only AIB and Bank of Ireland, who are both shedding large numbers of jobs, are certain to survive in anything like their current form. Several more financial institutions including Anglo Irish, Irish Nationwide and a gaggle of foreign-owned banks will probably disappear from the market altogether.

It is not beyond the bounds of possibility that we will be left with just three, drastically slimmed-down banks, AIB, Bank of Ireland and Ulster, while only two or three insurance companies survive. This could see the number of financial services jobs eventually halve, a loss of up to 30,000 jobs.

That is by any yardstick a truly terrifying figure. Normally, if that number of jobs were under threat in any region we would by now be bombarded with task forces and a ministerial committee designed to "do something", whatever that might be, about the situation.

Not this time. Instead, Enterprise and Unemployment Minister Batt O'Keeffe wrote to AIB and Bank of Ireland last month seeking "urgent clarity" on their redundancy plans. I don't know about you, but that doesn't exactly fill me with confidence.

If I were a financial services worker I would be afraid, very afraid, for my job.