Barclays PLC's global card unit is going against the grain by hiring while other issuers hand out thousands of pink slips, and by doing so in one of the world's most expensive cities.
The London banking company said this week that Barclaycard is hiring 200 people for an office it has opened in New York, a place that is weathering layoffs by local companies like American Express Co. and Citigroup Inc. Barclays said it has made more than 20 hires so far.
In a reversal of the usual offshoring trend, the office will support Barclaycard's expansion in countries like Germany, South Africa, the United Arab Emirates — and even India. "We've done the traditional offshoring to places like India, but this is the first formal large-scale activity where we're trying to access the talent pools in the New York market," said Antony Jenkins, Barclaycard's chief executive.
His unit's Indian operations do "primarily call-center work," while the New York office will handle credit risk and market analytics. "The card business runs on analytics, and we think we can access a very high-quality labor pool at an effective cost," Mr. Jenkins said. He called the New York site an example of "right-shoring — locating the work where you can best access the talent at the right cost."
To be sure, 200 employees is a minute addition to Barclaycard's work force of 11,000. And office space is cheaper in New York than in London. Still, Mr. Jenkins, who helped run Citi's cards business before joining Barclaycard three years ago, said opening an office in New York is "slightly unusual" for a big, international issuer.
Observers said the time may be ideal for such a move.
"This is taking advantage of the job market in banking in New York to get some very good people without having to pay over the odds for it," said Olann Kerrison, the head of publishing for the London research and publishing firm Lafferty Group. "I think the level of expertise that they will find will be higher than in some of the markets that they will be looking to expand into."
Supporting international expansion from New York is "almost like a reverse of what's happened before, when issuers have gone from developed markets into developing markets" and hired locals or moved employees from London or New York, Mr. Kerrison said.
"Many issuers at the moment are thinking more about survival than expansion," he said. "This is a very confident statement by Barclays."
HSBC Holdings PLC has said it is reducing costs by integrating systems across its global operations; in August the London banking company said that about three-quarters of its cards around the world were on the One HSBC Cards platform and that it planned conversions this year in India and Indonesia.
Barclaycard's New York office will not support its U.S. business, which is based in Wilmington, Del. Mr. Jenkins said Barclaycard US has joined other issuers in cutting credit lines and reducing account acquisitions, but is on track to meet its $150 million profit target for the year. "We're taking a prudent stance on credit, but we still see growth opportunities in the medium term," he said.
Barclaycard said it had established the New York office before its parent company bought the U.S. capital-markets businesses of the bankrupt Lehman Brothers in September. Lehman was a big underwriter of asset-backed securities, an important source of funding for card issuers. Mr. Jenkins said "it's certainly a possibility" that former Lehman employees in New York could contribute their expertise to his unit, but no decision has been made.
