Advisory Firms Need to Hire More Staff — and Fast
The industry will need more than 70,000 new staff over the next five years, according to a Charles Schwab report.
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The RIA industry is grappling with a talent shortage, and as 2025 quickly approaches, the competition for skilled professionals is only intensifying. Independent advisors will need to hire more than 70,000 new employees over the next five years, according to a Charles Schwab report. That’s without accounting for resignations and retirements.
Ironically, the shortfall is due in large part to the industry’s own success. With markets on an extended run, assets are growing and client retention is through the roof, making demand for more experienced advisors a top priority. It’s a growing issue the industry is trying to solve through hiring and career development programs.
Put Me in the Will
The upcoming Great Wealth Transfer isn’t helping either, as the movement of $124 trillion in assets over the next generation will call for more skilled advisors.
“There’s a very heavy barbell in terms of what talent is available,” said James Bogart, CEO of Bogart Wealth. While there are employees available who are at the later stages of their careers or just starting out, middle-career advisors are much harder to find. “The huge component we’re missing are advisors in the 30 to 45 year-old range who are best suited for long term relationships,” he said.
More, More, More. Last year, the median firm saw its assets under management jump by nearly 18%, and client retention remained high at 97%, according to the research. That’s all well and good, but the problem now lies in providing the best experience to clients. “Firms are casting a wide net,” said Lisa Salvi, Head of Business Consulting & Education at Schwab Advisor Services.
Over the past five years, about three-quarters of firms have brought on new staff each year, according to the research. Plus, 76% of firms reported career development opportunities for new, less experienced advisors to make sure they stick around. “Gen Zs are coming out of school very hungry and ambitious, but lacking the technical skills and sales training they need to be deeply impactful advisors,” Bogart said.
Need a Job? While training programs can help, firms may need to hire even faster, said Stephen Carusso, associate director of Wealth Management at Cerulli Associates. If a firm hires one incremental person, but the entire team is back to full capacity after six months, working 50-hour weeks, it hasn’t solved the problem. “That hire was behind the eight ball,” he told The Daily Upside.
