The number of new jobs created in the City of London fell by a tenth last month amid a hiring freeze by investment banks, according to a new study.
Recruitment firm Astbury Marsden said there were 2,460 new posts in May, 10% down on April, but 3% up on the same month last year.
Smaller City firms are taking on new employees, but this is being dwarfed by investment banks keeping staffing levels on hold, said the report.
Cathryn Jowett, operations director at Astbury Marsden, said: "Even though some of the bigger banks are seizing the opportunity to snap up new staff from rivals that have recruitment freezes or are cutting staff, that isn't quite enough to make the overall picture more positive.
"Similarly, while the work that big investment banks have been forced to shed by the regulators - like proprietary trading - is being picked up by newer start-ups, the transition is holding the jobs market down."
"For the bankers and traders who are living through this, it is quite a painful evolution the City is going through."