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Financial advice faces recruitment 'double challenge'

Financial advice faces a "double challenge" in recruitment due to an ageing demographic and the decline of traditional entry points into the profession, according to Tom Hegarty. 

Speaking at the PA360 conference, the New Model Business Academy (NMBA) managing director said his firm had conducted a survey, asking its members about their background.

The main points of entry, Hegarty (pictured) said, were tied sales, life and pensions companies and banking.

"What is interesting is that tied sales, life and pensions and banking have kind of disappeared so they're not points of entry anymore," he commented.  

While the average age of advisers varied depending on the source of research, Hegarty said it was always above 45.

"Coupled with the challenges we face in terms of bring new people into the sector and the points of entry, that creates a double challenge as to what future might look like," he said.

In another survey, nine in 10 (90%) NMBA members thought the industry was not doing enough to recruit, attract or support new blood in the profession.

Members were also asked what they found to be the greatest challenge in recruiting a trainee, with the time and cost of the process cited as the biggest concern by nearly a third (30%) of respondents.

Apprenticeships

Entering financial advice through an apprenticeship, Hegarty said was one solution to the recruitment issue.

"Certainly in financial services, this provides a career progression opportunity where you could as a firm chose to bring somebody in at a certain level and progress them through a different route, ultimately to financial advisers," he said.

The government now looked to get some 3 million people into apprenticeship schemes by 2020, he explained. As a result, in April 2017 it introduced a levy-based approach to apprenticeship funding with a view to pooling money from those employers with a payroll of more than £3m.

Click here to read the full article in Profesional Adviser