New recruits needed to avert skills shortage as advisor market poised for significant growth - Prudential

The findings of new research from Prudential has added to fears of a looming skills shortage in the adviser market, with not enough being done to encourage new recruits.

While the nationwide study found that nearly two out of five financial advisers are increasingly optimistic that the market for advice will continue to grow, and (38 per cent) expect the need for number of advisers in the profession to increase over the next 12 months, there are real concerns about where the new recruits will come from, with nearly a third of advisers (31 per cent) saying they believe not enough is being done to encourage people into the profession.

The expectation-of-growth findings underline a dramatic turnaround in just 12 months as last year more than half (51 per cent) expected numbers across the profession to fall.

According to the research, part of the reason for the turnaround is increased confidence in recommending financial advice as a career for new recruits. Around 70 per cent of those surveyed said they would urge others to start a career in financial advice.

But advisers believe financial adviser trade bodies and providers must bear most responsibility for making sure there are new recruits to fill the ranks – around 83 per cent of those questioned want to see co-ordinated action to encourage more people into the advice sector.

As part of its commitment to supporting advisers, Prudential said it is itself partnering with the Personal Finance Society (PFS) on Aspire, the professional body’s financial adviser development programme, designed to bring fresh talent to the advice market.

Keith Richards, chief executive of the Personal Finance Society, said: “It’s encouraging to see that advisers are increasingly optimistic about the future growth of their profession, supported of course by evident consumer demand and the growing recognition by government and policy makers of the key role that financial planning has to play in society.

“We need to support this growing demand and the need for succession planning through attracting and developing new talent which is vital to the ongoing success of the profession.

“The Personal Finance Society’s recently-launched Aspire programme, which Prudential is supporting, offers wide-ranging assistance to employers of aspiring personal finance professionals to help them achieve the necessary qualifications and skills required to support the public.”

Paul Harrison, head of Prudential’s Business Consultancy for advisers, said: “Consumer demand for financial advice is increasing and this is reflected in the dramatic turnaround in advisers’ expectations over the past year, with evidence of increased optimism about the growth of the profession and recruitment levels in the next 12 months and beyond.

“Supporting advisers is a priority for us and an important part of this is working with the PFS on its Aspire development programme to help bring fresh talent into the profession.”

Ideas designed to boost the numbers of financial advice recruits in the short-term include expanding the apprenticeship schemes offered by providers – around 69 per cent of advisers say providers should invest in more of these schemes.

In the longer term, nearly three out of four advisers (74 per cent) say schools and universities should do more to promote financial advice as a career choice while 58 per cent of those questioned say the Government should consider supporting and sponsoring a campaign to recruit more financial advisers.