Is the financial sector at risk?
Will Frankfurt lose its position as the undisputed center of financial Europe? A recent study predicts tough times for the city. Accordingly, employment in the Frankfurt banking sector would fall. But there remains a glimmer of hope.
What is happening to Frankfurt? If you believe a study by Helaba Research & Advisory, Germany’s banking city is on the verge of a downturn. Accordingly, a decline in employment in Frankfurt’s banks is expected in the coming years – albeit to a lesser extent than previously assumed.
In addition to the ongoing corona pandemic, the reason for this forecast is the low interest rate environment, the sustainability efforts and the digitization of the banks. The financial sector would thus be faced with a mammoth task, as the study states.
Minus four percent by 2023
By the end of next year, the authors of the study assume that there will be 63,500 employees working in the Frankfurt bank towers. This corresponds to a drop of four percent or 2,600 fewer jobs than in mid-2021. It should be taken into account that there was an increase in bank employment in Frankfurt in 2021.
Don’t worry, Frankfurt remains stable
But the authors of the study offer hope: The “financial center Frankfurt” has proven to be adaptable, which means that it has remained important. Also thanks to the quality of the location, the city has long held the leading role in Germany and even in continental Europe.
In addition, the study authors believe that physical financial locations will continue to be important in the future. They would remain innovative and business-promoting exchange places, despite changes in the working world. Many companies are currently planning new work concepts. The bandwidth for mobile working at German banks currently ranges from 40 percent to 100 percent. Two to three days remote per week is considered the ideal of the hybrid working model.
The banks are currently examining the space requirements in the office towers, as savings are expected as part of the home office trend. Larger ones between the individual jobs of the employees are also expected. All in all, there would probably only be a moderate drop in demand for office space – a process that will not start all of a sudden, but will probably last for many years.
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