Banks are becoming more receptive to remote work as employees prioritize flexibility and career advancement opportunities, according to a recent survey from Chicago-based consulting firm Crowe.
The firm’s 2023 bank compensation and benefits survey included responses from 388 banks, most of which were $1 billion or smaller. Seventy percent of organizations allowed at least one day of remote work per week for some employees, a 17-percentage-point increase from 2022. Nearly 11 percent are willing to hire fully remote positions in certain areas, with the credit analyst position seen as the most adaptable to a remote environment.
“It demonstrates that the banking industry — which might adopt changes more cautiously — is aware that staying competitive means nontraditional accommodations are necessary,” the report stated. “While hiring employees within a specific geographic footprint remains the most desirable option, banks are reckoning with a generation of employees that wants freedom and mobility.”
The labor market remains tight as U.S. unemployment was at 3.8 percent last month. According to the report, base salary increases are still normalizing to pre-pandemic levels as hourly roles such as teller, teller operations supervisor and item processing positions received some of the highest raises.
“Employees within this salary range have various career options outside of financial services organizations that might have less responsibility and more flexibility, which might be one factor that is contributing to higher base salary increases for these positions,” Crowe stated.
The average pay increase for top performers was 7.2 percent, down 28 percent from 10 percent in 2022. Employees who met expectations received an average increase of 4.5 percent, down 47 percent from 8.5 percent from the previous year. “Balancing compensation as an element of a total compensation and benefits package will be important as we move into 2024,” the report stated.
Though non-officer job turnover has dropped this year, the teller position reportedly continues to be the most challenging to recruit and retain as banks shift to a universal banker model from a teller model. Officer turnover increased for the second year in a row, to 6.5 percent from 3.2 percent in 2021. “The exact rationale is not completely clear, but we are seeing that economic volatility is leading to job changes at all levels,” Crowe stated.
Employee benefits were also listed as a key factor in attracting and keeping employees. Some banks reported offering incentives to employees to elect for insurance elsewhere. Twenty-five percent are increasing deductibles while slightly more have increased their employees’ share of premiums.
Nearly 45 percent cited a lack of career development and advancement options in seeking employment elsewhere. According to Crowe, banks can change this trend by instituting career development programs focusing on high performers and providing more extensive on-the-job training.
Regarding hiring young talent, nearly 65 percent said that doing so was as challenging as in 2022. “This talent pool wants to work in a business environment that allows for creativity, adapts to change, and embraces technology — all areas that can be difficult for banks to navigate,” the report stated. “Despite these perceived gaps, the banking industry can provide younger talent with the experiences they are seeking through automation, remote work flexibility and a work culture that emphasizes experiences and values over only compensation.”
Editor’s Note: A previous version of this story listed an incorrect headquarters for Crowe. The consulting firm is based in Chicago.