The number of confirmed City job offers fell 21% in December, compared to the previous month, according to a study from pre-employment screening firm Powerchex.

The research reveals investment banks saw opportunities drop by 65%, while vacancies in insurance firms were down 17%.

Meanwhile, gains for investment management, stockbrokers and hedge funds (up 12%, 5% and 1% respectively) failed to prevent overall recruitment activity within financial services by slumping by more than a fifth.

Alexandra Kelly, managing director  and founder of Powerchex and now MD of HireRight’s screening operations in EMEA, says: “Nervous not to get left behind when the economy picked-up, I suspect that many companies may have over-hired during 2010. I wonder whether we may be facing a slow couple of months as companies look to reduce their staffing levels in line with their business needs.

“It is important to put the December figures in the context of the past couple of years; 37% more job offers were made by FS companies in 2010 compared to 2009. In fact, recruitment activity is up across all industry sectors, which means that we would need to see a catastrophic decline in fortunes across the whole of financial services to get anywhere close to 2009 levels.”