Banks invest heavily in data scientists for mining alternative data

Leading banks like Citi, HSBC, Morgan Stanley and UBS are racing to hire data analysts, data scientists, data platform managers and more

Key Takeaway

Hiring data gleaned from Outside Insight shows an upward trend in open jobs in the data analysis, data engineering and data platform and management space as leading financial institutions invest heavily in alternative data capabilities, both internally and in the form of new product lines.

AI-driven data analysis is quickly becoming a prerequisite for any companies looking to maintain a competitive advantage as the coming AI revolution takes hold. Among the early adopters implementing AI transformation now are the world’s leading banks and investment firms.

McKinsey Global Institute recently released a report that measures the potential impact of AI on the global economy, based on a simulation model created by their analysts. They estimated that at least 70% of companies will have adopted some form of AI by 2030. Furthermore, AI “has the potential to deliver additional global economic activity of around $13 trillion by 2030, or about 16 percent higher cumulative GDP compared with today. This amounts to 1.2 percent additional GDP growth per year.”

Financial institutions, often at the forefront of information innovation, have already begun building analytics and cognitive capabilities internally in order to leverage the vast amount of alternative data available for decision-making. According to CB Insights, last year general spending on financial market data and analysis rose 3.6% and hit a record $28.5B.

Insights from show the alternative data industry is projected to be worth $350M in 2020. The percentage of funds that use or expect to use alternative data is 78%, up from 52% in 2016. To support this growing need, the number of alternative data full time employees has grown ~450% in the last 5 years.

This trend is reflected in the hiring trends at major global banks. Those looking out at recent job postings will note an influx of open roles for data science and data analyst resources – something that we weren’t seeing to this degree even a year ago.

Banks bring in the data and analytics big guns noted a recent job post on Citi’s website looking for data scientists to join a new consulting team that will work directly with clients on bespoke data requests. “The projects will involve what the bank calls ‘non-markets’ data – foot traffic, cellphone signals, satellite images, credit card and point-of-sale transactions data, geospatial datasets and, notably, ‘institutional’ aggregated financial flows.”

This sort of data is referred to as alternative data in the finance space. Insights gleaned from signals within this external information can offer a significant advantage when it comes to trading decisions – as well as marketing and sales prospecting. Taking a look at where banks are hiring is a great indicator of which firms are investing most in this space. Our data shows Citi, UBS and Morgan Stanley are currently taking the lead.

Alternatively, banks are also amping up their data and intelligence capabilities to derive new sources of income by potentially re-selling their own institutional data back to customers.

Citi is already ahead of the curve when it comes to external publication of data and proprietary insights through their Citi Velocity trading platform, which offers clients free access to their latest research, liquidity and capital markets intelligence. State Street has a similar offering called State Street Global Exchange, “dedicated to turning the data it derives from servicing roughly 11% of global fund assets into useful insights.”

Forward-looking indicators

Hiring trends are fantastic forward-looking indicators that reveal where companies are investing heavily in resources and betting on the future. Those looking out can discover insights in their competitors’ hiring trends, and dig deeper into other sources – like recent press releases or investment announcements, social media conversations, keyword bidding, search data and more – to connect the dots and discover what their competitors will do next.

Learn more about insights from external data at

Recent Articles