ERIC Number: ED428264
Record Type: Non-Journal
Publication Date: 1999-Feb
Reference Count: N/A
Market Segmentation and the Restructuring of Banking Jobs. IEE Brief Number 24.
Hughes, Katherine; Bernhardt, Annette
The banking industry has undergone marked changes over the past 20 years, driven by deregulation and new technologies. Two strategies have emerged: the low-cost transaction approach and the high-road relationship banking approach. The number of employees in commercial banking has fallen significantly, and average hourly earnings for nonmanagerial employees have remained low. A case study of a large, multinational bank showed a reduction in employees. Reengineering has had important effects on the staffing, task content, and quality of jobs at the bank branches. Back-office jobs have been eliminated or moved to national customer-service phone centers, whereas some jobs have been upgraded toward customer service. Teller jobs have become mostly part time, especially for entry. Although the bank requires high levels of communication skills for tellers, it has difficulty attracting the type of people it needs to a job with low status and low pay. Tellers have a high rate of attrition because of low pay and few opportunities for upward mobility. At the same time, tellers are expected to participate more in sales while still making accurate transactions, leading to more job stress. The process of restructuring is ongoing and is redefining the role of bank employees. Low-level employees are expected to have increased commitment to and performance for the firm, whereas rewards--compensation, upward mobility, and rewarding job content--usually lag behind. (KC)
Publication Type: Reports - Research
Education Level: N/A
Sponsor: Grant (W.T.) Foundation, New York, NY.
Authoring Institution: Columbia Univ., New York, NY. Inst. on Education and the Economy.