Employment opportunities dwindle as banks downsize

But qualified managers remain in short supply

Growth of bank assets from the population and business boom along the Front Range is not resulting in the growth of wages or an increase in job opportunities in the banking industry, Northern Colorado bankers say.

But it is changing the business of banking.

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Federal regulatory reports show that the U.S. banking industry has bucked a nationwide trend toward increased service-sector employment, gaining only 2,061 jobs in state-chartered banks and thrifts, only one-tenth of 1 percent, as of the year ending Sept. 30 1996.

Colorado banks and thrifts actually lost 203 positions, 1.2 percent, meaning that the employment situation is considered stable. Banks in both Weld and Larimer counties mirror these trends.

The lag in the creation of banking jobs is blamed on that usual corporate suspect, downsizing. That, along with consolidation of services, has hit hardest at large, full-service banks.

“Management, middle-management, those positions are gone due to downsizing,” affirmed Debbie Hague, relationship manager for Key Bank, which maintains 30 branches in Colorado, including eight in Northern Colorado. “Loss of jobs through attrition is not limited to Key Bank or to the banking industry.”

In part, the slowing of growth in banking job opportunities can be traced to changes in the lifestyles and service demands of bank customers.

Key Bank, for example, has placed automatic teller machines in its driveups. While customers now have 24-hour access to ATMS, drive-up staff positions are eliminated. What happens to those employees?

“We’ve not laid off anyone because of that,” Hague said. “However, those positions have been lost, so we’ve placed those employees in other positions with the bank.”

Downsizing has also resulted in consolidation of staff-position responsibilities, particularly at the middle-management level.

“Previously, one person was a loan manager and another a personal banker,” Hague said. “Those positions have been consolidated.”

Banks that may have had as many as 10 specialized middle managers now have only two or three. In some branches of large banks serving smaller communities, there is often only one manager responsible for the bank’s full range of services.

Downsizing and consolidation, along with a relatively content employee pool, have stiffened the market for middle-management positions that have survived.

“The unemployment rate (in Colorado) is so low,´ said Mark Driscoll, president of First National Bank of Fort Collins, “that we are at better than full employment for this market. People are working. They are not out looking for jobs.”

So, with a content work force fully employed even in a downsized industry, everyone is happy, right?

Wrong.

Aspiring entrants into the cramped financial-services work force, primarily recent college graduates, are being forced to take less-responsible, lower-paying staff positions, usually as tellers. They hope to use the teller positions as a springboard into management. For most, that will never happen, or it will take far longer and be less financially rewarding. Entry-level positions are becoming forced career choices.

“There is no problem filling entry-level positions,´ said James Tuggle, manager of Union Colony Bank in Greeley. “Local colleges provide a large, well-trained labor pool for entry-level jobs.”

Of course, it helps to have a large university such as the University of Northern Colorado in a county that is relatively small and has fewer employment options open to local students. But the situation is not much different in Fort Collins.

“We’ve not had a problem,” Hague said.

The student glut in Fort Collins, home of Colorado State University, may be allowing banks the time to pick and choose from among would-be employees previously deemed overqualified for entry-level positions.

“We don’t have a problem getting job applicants generally,” Driscoll said. “Background and experience in a certain skill may not be there. So we work harder to screen and interview the kind of employee we are looking for when we have a position to fill.”

As in other industries where downsizing has become the norm, wage growth in the banking industry has stagnated. Career progress, once available through programmed promotions up the organization, is also stalled. That means there are fewer management opportunities, but also fewer individuals with the skills needed to handle positions that are available.

“To find qualified managers,” Tuggle said, “we sometimes have to go further. I think in Weld County, there is not as available a pool of skilled managers as in Denver.”

Tuggle said the situation has not forced his bank to increase compensation packages for management positions, but “sometimes we have to go further.”

Driscoll disagrees only a little.

“I don’t know if we have to go further geographically,” he says. “We have to look deeper.”

Driscoll said the few managerial positions filled from outside his bank are also filled generally by candidates from Denver.

Full employment, stagnant wages, limited opportunity for career growth, downsizing, consolidation and entry-level jobs that become careers. Not a great outlook for the would-be banker, right?

Wrong again.

Key to succeeding in the modern banking world is that old standby of the retail trade, customer service.

“Most people know people, and we do a lot of referral business,” Hague said of her specialty, private banking.

In a corporate environment suffering from wage stagnation and a decline in real wages, getting along with people may be the golden ticket to a higher paycheck.

“A couple of years ago,” Driscoll recalled, “we looked at the wages of people who work with the public every day, like personal bankers and tellers. We significantly increased the compensation in those positions.”

Hague said that market segmentation, creating niche markets within the banking consumer universe, has become the dominant theme of the banking industry. And in every market segment, the customer has become the focus.

“Putting the right customers with the right line of business and developing a relationship with the customer,” Hague said, “that is the direction in which we are going.”

Other full-service banks such as Norwest Banks, Colorado National Bank and Wells Fargo are also moving in directions that emphasize a broad array of financial services handled with a personal touch.

The increased emphasis on customer service is evidenced in Hague’s official title, relationship manager and in her duties as a private banking specialist.

“With private banking,” Hague said, “I am always in contact with my clients. It is very hands-on,”

Hague frequently meets with her private banking clientele, generally larger depositors who may make up about 20 percent of the bank’s business,

“Without them,” Hague said “we wouldn’t have a bank.”

How far does the personal touch go with these customers?

“We even go to their weddings and send flowers on their birthdays,” she said.