Looking for a job in troubled markets can be a daunting task. But financial advisors have reason to be hopeful: Despite the turmoil, more firms than ever are hungry for top talent.
“If you have a client base and a lot of assets and a clean compliance record, you will have your pick from a host of career options—more so than ever before,” said Darin Manis, chief executive of RJ & Makay a financial recruiting firm in Colorado Springs, Colo.
The opportunities for advisors come as transition packages—while still lofty—have dropped back from their record highs and the industry is still adjusting to the collapse or consolidation of several large, well-established firms in 2008. On top of this, many advisors are concerned about the stability of their firms and are unhappy at having their payouts lowered. Others feel fewer ties to their firms as shares of company stock continue to fall precipitously. Meanwhile, firms across the spectrum are seeing revenue drop and are trying to acquire advisors in order to quickly boost the bottom line.
”Most financial advisors are looking at least at a couple of offers that are out there,” Manis said.
To be sure, the hiring landscape is in a constant state of flux. For example, a year-and-a-half ago, the Street was willing to pay whatever a broker wanted, but now firms are more cost-conscious, said Skiddy von Stade, president of F.S. von Stade & Associates, a Manhattan-based recruiting firm. “They are being much more reflective about their hiring decisions,” said von Stade, who is also chairman of OneWire.com, a career management and hiring tool for the finance industry.
So where are opportunities for advisors who are serious about leaving or may have the decision made for them? Virtually all over, recruiters say.
While openings at wirehouses have shrunk a bit due to consolidation, big firms are still looking for top talent, von Stade said. That’s because the brokerage business brings in recurring revenue and doesn’t put the organization’s balance sheet at risk. “Everybody’s trying to build their asset base,” he said.
Smaller firms are also looking to grow. Indeed, while there aren’t a lot of regional firms left, there are small financial planning shops across the country that are happily digesting the fallout from Wall Street, according to Larry Sukay, managing partner in the San Diego office of Lucas Group, a recruiting firm.
“Individuals that are coming out of large firms are tired of the promises that couldn’t be delivered. They’re tired of the old business model. They’re tired of the same old stuff. They like the smaller environment, the personalized service, the more entrepreneurial organizations,” Sukay said.
The independent and registered investment advisor channels are also actively searching for talent.
Manis of RJ & Makay, for example, said he gets four to seven calls per week from RIA firms seeking to expand. “It just shows you how many RIAs are out there aggressively trying to attract financial advisors to their firms.”
Two to two-and-a-half years ago, majority of conversations Marcy Burton, chief marketing officer at Partnervest, an independent broker/dealer and RIA in Santa Barbara, Calif., had were with advisors who worked for other independent firms. “Now I am talking to as many wirehouse brokers as I do other independents,” she said.
Of course, at this point, it’s still a lot of talk. Every day she talks to advisors who have been thinking about making a switch to independence—some of whom have been mulling a decision for more than a year. “It’s so easy to go from Merrill to UBS. It’s a known entity. It’s a similar shop. They know what to expect and they know what’s expected of them,” she said.
But going independent takes considerably more time. “It’s a whole different way of life. It’s like moving to a foreign country and not speaking the language. So then the task is to surround yourself with people who you trust and build from there.”
To be certain, change of any kind can be scary and even more so at a time when clients are jittery and financial markets so rocky. That’s why more than ever, advisors who are in a position to do so need to carefully weigh the costs and benefits of switching firms.
“In the final analysis, it’s a personal business decision, and people have to weigh the potential risk of losing assets and the benefits that they will receive from their new employer,” von Stade said. “I think also that people need to make sure that they’re not making short-term decisions based on a bump in their salary.”