Boutiques reluctant to hire
There seems to be a sizeable gap between boutique dealer groups and major institutions in terms of financial planner recruitment this year, as the two sectors face different challenges ahead of the introduction of the upcoming regulatory changes.
While banks and major institutions seem to be hiring in bulk, experts claim non-bank aligned dealer groups are approaching recruitment with a certain degree of caution.
Ejobs Recruitment Specialists managing director Trevor Punnett (pictured), who mostly recruits for boutique dealer groups, said employer demand for financial planners and paraplanners had been dropping since the first mention of the Future of Financial Advice (FOFA) reforms, while back-office roles were most likely to be on the up.
This may be due to the fact that most dealer groups have not yet determined how costly the shift in their business and remuneration models will be, as well as the implementation of the proposed 'opt-in' requirement, Punnett said.
"In the past two years, [boutiques] have battened down the hatches. They've really been mindful of costs and haven't been in expansion mode, because there has been the uncertainty over FOFA and the change of the business model," Punnett said.
However, the financial planning industry has claimed that many of the proposed changes would bring on extra administrative burdens, and recruitment experts note reinforcing back-office teams is a way of preparing for the new regulatory environment.
On the other hand, the banking sector has remained strong on the hiring front, and large institutions are fighting the apparent skills shortage in financial planning by introducing their own recruitment programs.
The banks' strong hiring intentions could be explained by the Australian Securities and Investments Commission's push for the introduction of scaled advice, which the Federal Government is currently considering.
"If people don't want to go to the boutiques because of the perceived costs or self-interests, they might go to the banks where they'll get a lower cost service, and scaled service has just done what they want," Punnett said.
Director of specialist recruitment group Profusion, Alison Loader, said that institutions were increasingly focusing on growing their own talent.
AMP Horizons Academy offers courses for aspiring financial planners, including a 10-month work placement at one of the aligned dealer groups.
The academy will have 149 graduates this year, according to director Tim Steele, who recently announced plans to double this number in the next couple of years.
Similarly, NAB Financial Planning launched its own recruitment program nine months ago, with several other courses also offered by MLC Advice Education.
Colonial First State's Institute of Advice offers training for new advisers, as well as professional development training for its existing advisers.
Recommended for you
David Sipina has been sentenced to three years under an intensive correction order for his role in the unlicensed Courtenay House financial services.
As AFSLs endeavour to meet their breach reporting obligations, a legal expert has emphasised why robust documentation will prove fruitful, particularly in the face of potential regulatory investigations.
Betashares has named the top Australian suburbs with the highest spare cash flow, shining a light on where financial advisers could eye out potential clients.
A relevant provider has received a written direction from the Financial Services and Credit Panel after a superannuation rollover resulted in tax bill of over $200,000 for a client.
