Britain’s financial sector added jobs at its fastest pace in years during 2025, driven by rising demand for artificial intelligence, data, and regulatory expertise. Even as hiring slowed toward the end of the year, recruiters say banks, asset managers, and fintech firms are still locked in a technology arms race they can’t afford to lose.
The result is a labor market that looks very different from just a few years ago, with software skills now rivaling traditional finance roles in sheer demand.
Technology skills reshape hiring priorities across finance
According to new figures from Morgan McKinley, vacancies across Britain’s financial services sector rose 12 per cent year-on-year in 2025. The increase was largely fueled by roles linked to artificial intelligence, data reporting, regulation, and digital infrastructure.
That growth came even as uncertainty clouded the final months of the year.
Global market volatility and questions surrounding the UK government’s November budget made hiring managers more cautious in the fourth quarter. Still, demand for specialist skills remained resilient enough to push overall vacancies higher for the year.
Recruiters describe it as selective confidence. Firms may be trimming around the edges, but they’re still spending where it matters most.
And right now, that’s technology.
Software roles overtake traditional finance functions
One of the clearest signals of change is the makeup of open roles.
Software and computer services jobs accounted for more than 16 per cent of all financial-sector vacancies in 2025, according to Morgan McKinley’s London Employment Monitor. That puts them ahead of both investment management and core banking roles, each of which represented about 15 per cent of vacancies.
That’s a notable shift for a sector long defined by front-office finance jobs.
Mark Astbury, a director at Morgan McKinley, said firms are prioritizing talent that can help them deploy AI tools, modernize legacy systems, and meet growing regulatory reporting demands.
Basically, the back end is now just as strategic as the trading floor.
And in some cases, more so.
Clerical and broking roles continue to shrink
While demand surged for technical specialists, other parts of the workforce continued to contract.
Clerical and administrative positions fell 16 per cent over the year, the recruiter said. Broking roles dropped even more sharply, down 20 per cent.
Automation played a central role.
Tasks once handled by large teams, such as trade processing, client onboarding, and basic reporting, are increasingly managed by AI-driven systems. Chatbots handle routine queries. Algorithms match buyers and sellers faster than humans ever could.
For firms under pressure to control costs, the logic is hard to ignore.
Still, the shift isn’t painless. These roles have traditionally been entry points into the industry, and their decline raises questions about future talent pipelines.
A hiring slowdown, but not a hiring freeze
Despite the strong annual growth, the pace of hiring cooled in the final quarter of 2025.
Market swings, geopolitical uncertainty, and lingering questions over fiscal policy made firms pause. Some delayed decisions. Others focused on short-term contracts rather than permanent roles.
But recruiters stress this wasn’t a collapse.
It was more like a breath being held.
Astbury said demand is expected to remain solid into the first quarter of 2026, supported by relatively low unemployment and stable inflation. UK unemployment sat around 5 per cent late last year, while inflation hovered near 3.2 per cent.
Those numbers matter. They give firms enough confidence to keep investing in people, even if cautiously.
Why AI has become non-negotiable for banks and funds
The rush for AI talent isn’t about buzzwords anymore.
Financial institutions are deploying machine learning models for fraud detection, credit scoring, risk management, and trading strategies. Regulators, meanwhile, are demanding more granular and timely data submissions, pushing firms to overhaul reporting systems.
AI sits at the intersection of both pressures.
Firms that lag risk falling behind competitors or drawing unwanted scrutiny from watchdogs. That’s a powerful motivator.
And unlike earlier waves of automation, today’s tools require ongoing human oversight. Data engineers, AI ethicists, compliance technologists, and model risk specialists are all in short supply.
So companies are paying up, and hiring aggressively.
London’s financial hub still dominates, but competition is rising
Much of the hiring remains concentrated in the City and Canary Wharf, with City of London continuing to act as the sector’s gravitational center.
But recruiters say regional hubs are gaining ground.
Manchester, Leeds, Birmingham, and Edinburgh are seeing increased demand for tech and data roles, particularly as firms embrace hybrid working models. Some companies are deliberately hiring outside London to access wider talent pools and manage salary costs.
That geographic spread is changing career paths, too. Workers no longer need to relocate to the capital to land high-impact roles in finance technology.
For some, that’s been a quiet upside of the shift.
The pressure on salaries and skills
Rising demand hasn’t gone unnoticed by workers.
Candidates with experience in AI, cloud infrastructure, cybersecurity, and regulatory technology are commanding strong salary increases, recruiters say. Counteroffers are common. So are bidding wars.
Employers are also investing more in training, trying to upskill existing staff rather than relying entirely on external hires.
But that approach has limits.
AI expertise takes time to build, and firms competing on speed often prefer to buy skills rather than grow them.
That tension is likely to define hiring strategies through 2026.
What this means for the future workforce
The data paints a picture of a sector in transition.
Finance isn’t shrinking. It’s reshaping itself around technology, data, and automation. The winners in the job market are those who can bridge finance and tech, or at least speak both languages fluently.
For graduates and early-career workers, the message is blunt. Technical literacy is no longer optional.
For mid-career professionals in declining roles, the path forward may involve retraining or moving into adjacent functions.
And for firms, the challenge is cultural as much as operational. Integrating AI into decision-making changes how teams work, how risks are assessed, and how accountability is defined.
That’s not something you solve with software alone.
A market still driven by competition
At its core, the hiring surge reflects competition.
UK financial firms are competing with global rivals, with fintech disruptors, and with entirely different industries for the same pool of tech talent. Falling behind on AI adoption isn’t just inefficient. It’s existential.
That reality explains why vacancies rose even in a year marked by uncertainty.
As 2026 begins, recruiters say the message from employers is consistent. Spend carefully. Hire selectively. But don’t lose ground.
In a sector built on information, the race for people who can turn data into decisions is only getting louder.
