Netherlands in Focus

Talent in Banking 2015 The Netherlands in Focus

UK Financial Services Insight Report contents

The Netherlands in Focus

• Key findings

• Macroeconomic and industry context

• Survey findings

• Banking is less popular among business students in the Netherlands than in all but five other countries surveyed, and its popularity has fallen significantly since the financial crisis

• Banks do not feature in the top five most popular employers of Dutch banking students; among banking-inclined students, the three largest Dutch banks are the most popular

• The top career goals of Dutch banking-inclined students are ‘to be competitively or intellectually challenged’ and ‘to be a leader or manager of people’

• Dutch banking-inclined students are much less concerned with being ‘creative/innovative’ than their business school peers

• Dutch banking-inclined students want ‘leadership opportunities’ and leaders who will support and inspire them, but do not expect to find these attributes in the banking sector

• Investment banking-inclined students have salary expectations that are significantly higher than the business student average

• Banks in the Netherlands are failing to attract female business students; this is particularly true of investment banks

Overall and youth unemployment, the Netherlands, 2008-2014

15%

10%

0% 2008 2009 2010 2011 2012 2013 2014

Overall Youth (Aged 15-24)

Growth in average real wages (US$), the Netherlands, 2008-2014

$4,500 12.0%

$4,000 10.0%

8.0% $3,500

6.0% $3,000 4.0% $2,500 2.0% $2,000 0.0% $1,500 -2.0%

$1,000 -4.0%

$500 -6.0%

$0 -8.0% 2008 2009 2010 2011 2012 2013 2014

Average wages (monthly, US$) Growth in average wages (US$; % annual)

Note: Average wages (monthly): average gross earnings per worker per month Growth in average wages (annual): percentage change in hourly wages in US$ over previous period Figures are converted to US$ using an average exchange rate 7 Source: Economist Intelligence Unit © 2015 Deloitte LLP. All rights reserved. The banking sector continues to decline; total banking assets decreased by almost 25 per cent between 2008 and 2014

Total banking assets in billion US$ and as % of real GDP, the Netherlands, 2008-2014 $4,500 600.0%

$4,000 500.0% $3,500

$3,000 400.0%

$2,500 300.0% $2,000

$1,500 200.0%

$1,000 100.0% $500

$0 0.0% 2008 2009 2010 2011 2012 2013 2014

Total banking assets (billion US$) Total banking assets as % of real GDP

Note: Total banking assets for 2010-2014 are Economist Intelligence Unit estimates Figures are converted to US$ using an average exchange rate 8 Source: Total banking assets – Economist Intelligence Unit; GDP - OECD © 2015 Deloitte LLP. All rights reserved. Survey findings

9 © 2015 Deloitte LLP. All rights reserved. Dutch banks are unpopular relative to international peers, having suffered a dent to their credibility, and pay levels, during and after the crisis Popularity of banking as a career choice, globally, 2015

China Hong Kong Singapore UK Italy Spain Brazil Sweden Russia Switzerland India Czech… Australia Poland Middle East Norway Canada US Ireland Finland South Africa Turkey Belgium France Netherlands UAE Mexico Denmark Germany Austria 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0%

Survey question: “Choose the five employers you most want to work for [from the list of employers you would consider working for], your five ideal employers”. Sector popularity is calculated as the number of times individual employers in specific industries are short-listed among the five “ideal employers.” 10 Source: Universum Talent Survey 2015; Deloitte Analysis © 2015 Deloitte LLP. All rights reserved. Banking has continued to fall in popularity since the crisis, and could soon be overtaken by transport and logistics, boosted by local hero, KLM

Eight most popular industries for business students in the Netherlands, 2008-2015 30.0%

25.0% Fast Moving Consumer Goods

Banks 20.0% Transportation and Logistics

Software and computer services 15.0% Auditing and Accounting

Management and Strategy Consulting 10.0%

Consumer Electronics and Household Appliances 5.0% Fashion, Accessories and Luxury Goods

0.0% 2008 2009 2010 2011 2012 2013 2014 2015

11 Source: Universum Talent Survey 2015; Deloitte Analysis © 2015 Deloitte LLP. All rights reserved. FMCG’s top place among Dutch business students can be attributed to Heineken’s and Unilever’s popularity; Dutch airline KLM takes first place

Most popular employers, Dutch business students, 2015

KLM 21.1%

Google 20.2%

Heineken 19.9%

Nike 17.3%

Unilever 17.0%

Survey question: “Choose the five employers you most want to work for [from the list of employers you would consider working for], your five ideal employers.”

12 Source: Universum Talent Survey 2015; Deloitte Analysis © 2015 Deloitte LLP. All rights reserved. The big three Dutch banks are the most attractive employers for banking-inclined students; KLM’s popularity persists even among this group

Most popular employers, Dutch banking-inclined students, 2015

Rabobank 47.0%

ING Group 32.3%

ABN Amro 26.7%

KLM 17.5%

J.P. Morgan 14.9%

Survey question: “Choose the five employers you most want to work for [from the list of employers you would consider working for], your five ideal employers.”

13 Source: Universum Talent Survey 2015; Deloitte Analysis © 2015 Deloitte LLP. All rights reserved. Dutch banking-inclined students value challenge and leadership more highly than ‘work/life balance’ and ‘job security’, the top two career goals for global peers

Career goals of Dutch banking-inclined students, 2013-2015

54.4% To be competitively or intellectually challenged 55.1% 48.8%

51.1% To be a leader or manager of people 43.5% 44.8%

45.2% To have work/life balance 48.9% 44.8%

44.7% To be entrepreneurial or creative/innovative 39.3% 39.7% 2015 36.1% 2014 To have an international career 44.1% 42.4% 2013

21.8% To be secure or stable in my job 24.3% 22.1%

18.3% To be autonomous or independent 12.7% 14.3%

12.8% To be a technical or functional expert 12.1% 10.7%

To be dedicated to a cause or to feel that I am serving a 12.6% 19.2% greater good 15.6%

14 Source: Universum Talent Survey 2015; Deloitte Analysis © 2015 Deloitte LLP. All rights reserved. The business students being attracted to banks are much less innovative than their peers, creating a vulnerability as tech and fintech companies attack the sector

Career goals of Dutch banking-inclined students vs all business students, 2015

To be competitively or intellectually challenged 45.4% 54.4%

To be a leader or manager of people 47.3% 51.1%

To have work/life balance 49.1% 45.2%

To be entrepreneurial or creative/innovative 54.5% 44.7%

To have an international career 38.9% 36.1%

To be secure or stable in my job 24.6% 21.8%

To be autonomous or independent 15.7% 18.3%

To be a technical or functional expert 8.0% 12.8%

To be dedicated to a cause or to feel that I am serving a greater good 14.2% 12.6%

All business students Banking-inclined students

Survey question: “Below is a list of nine possible career goals. Which are most important to you? Please select a maximum of 3 alternatives.” Importance of goals is then calculated as the percentage of students choosing each career goal on their shortlist of top three goals. Source: Universum Talent Survey 2015; Deloitte Analysis 15 1 http://www.dutchnews.nl/news/archives/2015/06/dutch-banks-risk-being-sidelined-in-innovation-payment-traffic-chief/ © 2015 Deloitte LLP. All rights reserved. Dutch banking-inclined students aspire to, but don’t expect, ‘leadership’, ‘inspiring management’, and a good environment, and expect, but don’t aspire to, bonuses

Dutch banking-inclined students' top 10 aspirations and expectations, 2015

Dutch banking-inclined students’ top 10 Dutch banking-inclined students’ top 10 aspirations, 2015 expectations, 2015

Good reference for future career 1st Financial strength 1st

Challenging work 2nd Good reference for future career 2nd Leaders who will support my 3rd Challenging work 3rd development Professional training and Leadership opportunities 4th 4th development Professional training and 5th Market success 5th development Market success 6th Prestige 6th Attractive/exciting products and Recognising performance 7th 7th services (meritocracy) Interaction with international Inspiring management 8th 8th clients and colleagues A friendly work environment 9th Performance-related bonus 9th A creative and dynamic work 10th High level of responsibility 10th environment

Not in top 10 expectations Students were asked to choose up to 12 attributes, out of a total of 40, that they most sought for their five shortlisted “ideal employers.” The ten attributes that scored most highly for banking-inclined students are shown in the green bars – “aspirations”. Deloitte extracted the extent to which banking-inclined students expected to find each of these top ten aspirations in their shortlisted “ideal” banks. Each blue bar represents the proportion of banking-inclined students who expect to find this attribute at the bank(s) that appears on their shortlist of five “ideal employers”. Please note that because the number of aspirations students can choose is capped at 12, while the expectations are uncapped up to 40, the proportions of students expecting a particular attribute is likely to be higher those recording an aspiration for that attribute. Survey question: Aspirations – which of these are most important to you? Please select a maximum of three alternatives [in each of the following four categories: Employer Reputation and Image; Job Characteristics; People and Culture; and Remuneration and Advancement Opportunities. Expectations – which of the following [40 attributes] do you associate with your chosen employer(s).

16 Source: Universum Talent Survey 2015; Deloitte Analysis © 2015 Deloitte LLP. All rights reserved. Dutch banking-inclined students expect 10 per cent higher—and investment- banking inclined 28 per cent higher—pay than do other business students

Expected average annual salary (EUR), Dutch business students, 2015

Investment banking-inclined € 35,849

Banking-inclined € 30,885

Insurance-inclined € 28,955

All business € 28,048

Survey question: “What is your expected salary before taxes (excluding commission and bonus) at your first employment after graduation?”

17 Source: Universum Talent Survey 2015; Deloitte Analysis © 2015 Deloitte LLP. All rights reserved. Investment banking is deterring female business students in the Netherlands to an even greater extent than the industry is globally

Student demographics, globally and in the Netherlands, 2015

Business students Business students (global) 61.1% 38.9% 60.9% 39.1% (Netherlands)

15.4 % drop off 17.9% drop off

Banking-inclined students Banking-inclined students 51.7% 48.3% 50.0% 50.0% (global) (Netherlands)

28.0% drop off 49.3% drop off

Investment banking-inclined Investment banking-inclined 44.0% 56.0% 30.9% 69.1% students (global) students (Netherlands)

Female Male Female Male

19 © 2015 Deloitte LLP. All rights reserved. Appendix – Methodology This report is based on the Universum Talent Survey 2015. Universum has been researching students’ career intentions since 1988. In 2014-15, it surveyed about 1.2 million students and professionals drawn from over 2,000 universities and institutes of higher education in 55 countries.

Deloitte examined the survey results from 211,000 business students in 30 markets: in the Americas, Brazil, Canada, Mexico and the US; in APAC, Australia, China, Hong Kong, India and Singapore; and in EMEA, Austria, Belgium, the Czech Republic, Denmark, Finland, France, Germany, Ireland, Italy, the Middle East (defined by Universum as Egypt, Lebanon, Kuwait, Qatar and Saudi Arabia), the Netherlands, Norway, Poland, Russia, South Africa, Spain, Sweden, Switzerland, Turkey, the UAE and the UK. The number of markets included in global and regional averages varies between 23 and 30.

Business students were presented with a list of employers from a range of industry sectors. Students selected “ideal employers” from the initial list in a three-stage process. First they chose an unlimited list of companies for which they might consider working. Next they narrowed the choice to a maximum of five “ideal employers”. Finally, they were asked to select companies they had applied to or were considering for an application.

Using the rankings by business students of the companies they would most like to work for, their “ideal employers”, Deloitte analysed their preferences across different industries over the eight academic years from 2007-08 to 2014-15. For this survey, business students are defined as students of business-related subjects. “Banking-inclined students” are a subset who put at least one bank (retail, investment or universal) in their top five “ideal employers”. “Investment banking-inclined students” are a subset of “banking-inclined students” who put at least one investment bank in their top five “ideal employers”. Using Universum’s detailed questionnaire, Deloitte analysed the motivations, aspirations and expectations of banking-inclined students in relation to a career in banking. This analysis includes a comparison of what makes banks attractive to students (“aspirations”) with what they associate with banks as employers (“expectations”).

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