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City Jobs: New Posts Down Amid Weak Economy

(c) Sky News 2013

The number of City jobs being created has fallen by more than a third, according to new figures.

Just 35,115 posts were created in 2012 - down 35% on the 54,025 in 2011.

In addition, around 800 new City jobs were available in December last year, compared with 1,490 in December 2011.

The data has been released by financial services recruitment firm  Astbury Marsden .

Chief operating officer Mark Cameron said 2012 "was a busy year for HR departments across the City as cost-cutting remained a key focus for senior management and board members throughout the year".

He added: "Tighter regulation including higher capital requirements forced up costs at a time when revenues dipped due to a number of factors including a continued weak economy and less trading activity.

"Although broad cost-cutting is fairly typical in the City during a downturn, 2012 was particularly significant as senior management in banks took very decisive action and implemented major structural changes including winding down entire units.

"Hopefully we are now behind the worst of the cost-cutting. Although banks may still tinker with staffing numbers, most of the obvious and immediate cuts are likely to have now been made."

The firm believes developments in the handling of the eurozone crisis since the autumn have started to have a positive impact, which could improve hiring confidence in 2013.

"Some of the dark clouds around the euro - which has been a major concern in the City for the last 18 months - seem to have lifted which will encourage some firms who are contemplating hiring staff," Mr Cameron said.

"Whilst the closure in the US budget battle is still to come, markets have responded well to progress already made there.

"For the world's largest economy, which is so important in setting trends globally, 2013 has certainly started on a more positive note than 2012 ended, which could help mitigate the gloomy outlook around hiring."

There has been a spate of redundancies in the financial sector as it battles to gain ground in a weak economy - amid increasing regulation and public scepticism.

Last month, banking giant Citigroup (NYSE: C - news) announced plans to axe 11,000 jobs worldwide - some 4% of its workforce - to cut costs.

In October, Switzerland's biggest bank UBS (Berlin: UBRA.BE - news) confirmed it was cutting 10,000 jobs to shrink its investment operations.

Of the total job cuts, it said 2,500 positions would be lost in Switzerland while the rest would be felt in the UK and US.

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