Bank of America Corp, which announced plans to slash 30,000 jobs, is adding financial advisors at its Merrill Lynch division, as many as 3,000 of them this year. Other firms, including Morgan Stanley, Edward Jones and Principal Financial Group, are in a hiring mode as well.
Demand for advisors and wealth managers is gaining strength as more Baby Boomers ready for retirement, which, given the stock market’s recent volatility, is an increasingly difficult goal for many to meet. Moreover, the ranks of advisors have been depleted by retirements and layoffs brought on by the recession. It’s no wonder that financial advisor is expected to be among the fastest-growing professions during the next decade.
Many of these jobs are independent contractors and are compensated based on the fees and commissions that they generate. These positions may appeal to career changers, particularly those accustomed to dealing with the public such as sales people. These jobs also require applicants to receive licenses, which vary depending on the products that are being sold. Many companies are including the Certified Financial Planner (CFP) credential in their training programs, according to Joseph Maugeri of the CFP Board.
“You really see a sea change at firms in terms of getting back into providing advice,” Maugeri told eFinancialCareers. “It’s been an ongoing trend but it’s been accelerating.”
The advisors that are in the highest demand, not surprisingly, are the ones with established books of business of between $25 million and $150 million, according to Tony Riotto, head of the recruiting firm Riotto-Jones & Co., LLC. Signing bonuses range between 1.4 and 1.8 times the trailing revenue with the expectation that an established advisor can bring his or her clients to a new firm.
“What I have been seeing are calls for people with established books of business,” he said in an interview with eFinancialCareers. “At one point, I was getting in the neighborhood of 15 resumes a day. It had started to diminish, but it’s now starting to pick up again.”
The most aggressive firms in terms of recruiting are Bank of America, Morgan Stanley and UBS, according to Bill Willis, the head of Willis Consulting, a recruiting firm.
“I don’t think there is any big winner among those three,” he told eFinancialCareers. “Ameriprise [also] is quite aggressive. Wells and RBC are pretty close behind in terms of their deals.”
Last year, Bloomberg reported that Merrill Lynch brokers were forced to reassure their clients that their money was safe despite the bank’s financial woes. The report also noted that Merrill advisors were increasingly interested in being recruited for new jobs. It appears as though the company took note.
“Merrill Lynch is making record levels of investment into our training and development program,” the company said in a statement to eFinancialCareers. “We've had nine consecutive quarters of advisor growth [a 9 percent increase over the last year]. Examples of our investment include: A formal mentor program for all new advisors, 43-month salary base [longest salary base in the industry] and refreshed/enhanced training and curriculum components.”
Morgan Stanley also is adding advisors. A company spokeswoman declined to provide details other than to say, “We continue to hire and retain the best FAs in the industry, and our salary is competitive with the Street.”
Some firms, such as Principal Financial Group, which is adding 350 advisors, actively seek out career changers such as former small business owners.
“We try to grow every office,” said Betsy Jepsen, director of recruiting and development at Principal Financial.
Edward Jones, which also targets career-changers, expect a net addition of 700 advisors this year, up from 345 last year, according to John Rahal, the Edward Jones partner who oversees recruitment. The St. Louis-based firm, unlike its competitors, puts its advisors on staff. “We hire W2 employees.” he said. “If you join Edward Jones, you are an employee of Edward Jones.”