October 31, 2013

Challenge: With every company focused on big data, finding data scientists to manipulate, crunch and make sense of petabytes of data is nearly impossible. Moreover, most universities are only beginning to launch data science graduate programs, so candidates with degrees in the field are still a few years away, at best.

Why It's Important: Financial firms have been investing heavily in big data technologies for the past few years. The term big data is definitely overused, but there is no doubt that business and technology leaders are banking that big data will help provide analytics for a variety of needs in the very near future, including regulatory reporting, client targeting, trading strategies, portfolio management and more. Unless financial firms want their big data investments to sit idle, it is critical to find data scientists and analysts who are proficient enough in statistics to use big data technology effectively.

"Finding big data talent is difficult, retaining it is nearly impossible." -- Dr. Usama Fayyad, Oasis500

Where The Industry Is Now: Finding data professionals or data scientists, unfortunately, is no easy task. "Finding big data talent is difficult, retaining it is nearly impossible," said Dr. Usama Fayyad, chairman of Oasis500, and former CDO at Yahoo! "And the role of data scientist is impossible to fill, especially outside of the US."

Fayyad's comments are alarming, especially since Gartner estimates there will be the need for 4.4 million big data jobs by 2015, with almost 2 million of those positions in the U.S. And forecasts from the McKinsey Global Institute on the availability of big data talent are just as foreboding. The U.S. will face a shortage of approximately 190,000 data scientists and 1.5 million analysts and data managers by 2018, according to McKinsey.

[For learn more about all of the topics that will shape the business technology landscape next year, download the November Digital Issue: Capital Markets Industry Outlook 2014.]

Unfortunately, universities are not yet up to the task of producing large numbers of data scientists. Only a few schools have degrees that focus on the data sciences. For instance, Stanford offers online courses for data mining and statistics. The University of California at Berkeley offers a Master of Information and Data Science (MIDS), but the program is only starting up in January 2014. It will take most students about a year to complete the MIDS course, but keep in mind that many enrollees will likely have full-time jobs and will only take the courses part time, lengthening the time until they graduate.

Focus In 2014: With it being hard to find data scientists on the open market, and relief from the university level a year or more away (at best), financial firms will need to invest in training and programs for employees who are interested in in data analytics. "It is difficult to recruit people right out of school for these positions," said Thomas Statnick, global head, Treasury and Trade Solutions Technology at Citibank. "For big data, it is a hybrid role ... business and technology. You have to train them or recruit them from business positions. It takes business, engineering and computer science skills. It is an interesting hybrid of a position, but it is really hard to find those people."

Industry Leaders: Competition is fierce for data scientists, to say the least. As a result, most data experts are demanding a premium on the open market – especially those who have business skills and understanding of a particular business segment. Companies such as PayPal, Google, eBay and Amazon are renown for their use of data and they are always recruiting data scientists.

In financial services, a number of firms have established data science organizations. At State Street David Saul is the Chief Scientist, and he spends a great deal of time focused on big data, semantic databases and other data disciplines. PayPal, Square and Deutsche Bank have all had chief scientist roles in their organizations as well.

Price Tag: Recruiters and hiring managers at financial firms say that finding qualified candidates with data analytics, statistical skills and knowledge of the financial services business is extremely difficult, if not impossible. Those candidates with the skills on their resumes command top dollar in today's market. As a result, many firms are choosing to recruit and train employees internally.

ABOUT THE AUTHOR
Greg MacSweeney is editorial director of InformationWeek Financial Services, whose brands include Wall Street & Technology, Bank Systems & Technology, Advanced Trading, and Insurance & Technology.