Hong Kong Towards a Leading Global FinTech Hub

66 67 Talent Part I: Examination of Seven Fintech Hubs IV. TALENT With a global market size valued at US$5,504bn in 2019 and an expected growth at CAGR 23.58% in 2021-25, 219 fintech hubs around the world know the importance of attracting global talent. The World Economic Forum has revealed that emerging fintech talent roles such as data analysts, AI and machine learning specialists, system engineers and developers – which accounted for 15% of the global financial services workforce – are expected to represent 29% of the workforce by 2022. 220 How to Keep Up with Current and Future Demand To keep up with the growing demand for talent, a global fintech hub will need to have a stable and sustainable supply of skilled personnel by sourcing from the existing workforce, attracting foreign workers who are already equipped with the required skills, as well as nurturing new talent from their local education system. Governments must examine the following to formulate an effective talent policy: 1. The number of existing qualified people in the sector; 2. Hiring trends for the local and global fintech industry; 3. Effective measures to attract foreign talent; 4. The number and type of existing city or country programs to develop talent; 5. The challenges that educational institutions have in developing quality training programs and schemes to reskill existing workers; and 6. How to best cultivate future generations of talent Policymakers should also look into immigration and employment laws that facilitate relocation of foreign workers to the city, and provide incentives to financial institutions and startups to recruit professionals from other regions or countries. With local and global situations in constant flux, fintech hubs will maintain stronger positions if they have the ability to produce, retain, and attract top talent both locally and globally. Governments need to formulate effective short-term policies to provide enough skilled people to overcome the current shortage. Simultaneously, governments need to design a long-term talent policy to keep up with the predicted exponential growth of fintech in the future. A multi-pronged approach may include: 1. Funding support to long-term policy instruments; 2. Measures to attract foreign talent; 3. Programs for upskilling existing workers; and 4. Changes to the current lower and higher educational curriculums. London: Cultivating Young Talent, but Lacks Reskill and Upskill Training for Existing Workforce The UK is ranked 21st in the Global Social Mobility Index 2020, 221 which is lower than Switzerland, Japan, and Singapore, ranked 7th, 15th and 20th, respectively. Its relatively low global social mobility will cost the UK economy £140bn (US$198bn) a year. 222 42% of workers in the UK fintech sector are from overseas. 223 London had more than 44,000 fintech workers in 2017, 224 and slightly less than 50% of the UK’s fintech workers are from other countries, 225 implying that the UK relies heavily on international talent. Following Brexit, EU nationals will be treated as same as non-EU nationals in terms of visa applications, and thus the ease of hiring EU talent will be gone. 226 There is a rich pool of fintech talent in the UK, which is supported by its world-class university system. In 2021, 17 UK universities are featured in the global top 100. 227 The UK is also home to 25 of the world's top MBA programs 228 and around 19 universities across the country are offering a Master’s degree program in fintech. Financial institutions and fintech companies have access to a vast pool of graduates of fintech-related majors. Due to the pandemic, it is estimated that around 700,000 graduates in the UK are facing an extremely difficult job market. 229 Nearly 40% of graduates major in business, information technology, and mathematics, 230 and could be a source of skilled entry-level talent for the sector. The generation of new talent graduating in the next few years could possibly make up for the loss of foreign talent following Brexit, but it will take time for the fresh graduates to take up roles beyond entry-level jobs. Meanwhile, there is an urgent need to retain and upskill existing workers, and reskill the current workforce to meet the needs of the UK’s fintech sector. It is estimated that overall, over 30 million people, which is 90% of the UK workforce, will need to be reskilled by 2030, and the urgency has been intensified by the COVID-19 pandemic. 231 For the fintech sector, it is expected that UK fintech firms will grow from 1,600 to 3,000 from 2018 to 2030, and the number of fintech workers employed would grow from 76,500 in 2018 to more than 100,000 in 2030. 232 219. TechSci Research. | Global Fintech Market By Technology (API; AI; Blockchain; Distributed Computing, Others), By Service (Payment; Fund Transfer; Personal Finance; Loans; Insurance; Others), By Application (Banking; Insurance; Securities & Others), By Region, Competition, Forecast & Opportunities, 2025 (Dec 2020). | https:// www.techsciresearch.com/report/fintech-market/4235.html 220. Department for International Trade, HM Treasury and Innovate Finance. | UK Fintech – State of the Nation. (Apr 2019). | https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/ file/801277/UK-fintech-state-of-the-nation.pdf 221. World Economic Forum. | The Global Social Mobility Report 2020-Equality, Opportunity and a New Economic Imperative (Jan 2020). http://www3.weforum.org/docs/Global_Social_Mobility_Report.pdf 222. World Economic Forum. | The Global Social Mobility Report 2020-Equality, Opportunity and a New Economic Imperative (Jan 2020). | http://www3.weforum.org/docs/Global_Social_Mobility_Report.pdf 223. Department for International Trade, HM Treasury and Innovate Finance. | UK Fintech – State of the Nation. (Apr 2019). | https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/ file/801277/UK-fintech-state-of-the-nation.pdf 224. Mayor of London. | London's fintech scheme at a glance (2017). | https://www.thepower50.com/wp-content/ uploads/2018/04/london-fintech-scene-2017-2.pdf 225. Innovate Finance. | Supporting UK FinTech: Accessing a Global Talent Poo l (2018). | https://www.innovatefinance. com/supportingukfintech/ 226. Edmans Co. | UK Visas After Brexit - Main Changes to Immigration Routes Post Brexit (2020). | https://edmansco. com/uk-visas-after-brexit/ 227. QS Top Universities. | QS World University Ranking 2021. | https://www.topuniversities.com/university-rankings/ world-university-rankings/2021 228. QS Top Universities. | World University Rankings - Full Time MBA: Global. | https://www.topuniversities.com/ university-rankings/mba-rankings/global/2021 229. HM Treasury. | Kalifa Review of UK Fintech (Jul 2020). | https://assets.publishing.service.gov.uk/government/ uploads/system/uploads/attachment_data/file/978396/KalifaReviewofUKFintech01.pdf 230. City of London. | The Global City. Our global offer to business: London and the UK’s competitive strengths in a changing world. | https://www.theglobalcity.uk/PositiveWebsite/media/Research-reports/CoL-Our-global-offer- to-business.pdf 231. CBI. | Learning for life (Oct 2020). | https://www.cbi.org.uk/media/5723/learning-for-life-report.pdf 232. Innovate Finance. | Supporting UK FinTech: Accessing a Global Talent Pool (2018). | https://www.innovatefinance. com/supportingukfintech/