Amid the exodus of advisers post-FASEA deadline, few departees have been willing to have any ongoing professional role in the industry, according to recruiters.
This is further compounded by the fact that although there is a limited number of advisers coming through the university ranks, the few that are doing so are looking to get into associate advice positions.
However, Vivere Recruitment Group CEO Chris Gordon tells Professional Planner the tight recruitment market has created an uplift in salary demand for support roles.
“What we have seen in the market is the advice support roles – those senior associate/client service people – that’s where we’ve seen a lift in salaries,” Gordon says.
Financial Advice Association chair David Sharpe wrote in an op-ed for Professional Planner last year asking advisers who didn’t want to stay on the ASIC Financial Adviser Register beyond the exam deadline to stay involved in the industry.
Almost a year on, Recruit 2 Advice principal Dugald Braithwaite hasn’t seen much demand from advisers who have come off the FAR to join in support roles.
“Very few mate, to be honest,” he says, adding he has instead seen advisers who were caught out by the exam deadline who had to re-enter the industry via the professional year.
“We’ve had a few successes with mature aged individuals – that 40–50-year-old bracket – coming back into that associate adviser level around that $80,000 to $90,000 mark, because that’s the entry point back in for them,” Braithwaite says.
“Some of them are coming off $130,000 to $140,000 a year but they need to do a professional year to be able to sit with clients again.”
Kaizen Recruitment wealth management recruiter Simon Gvalda says for a lot of back-office roles, the expectation for experience is quite high, often requiring at least 18 months.
“They want somebody who comes in that they’re not training from scratch,” Gvalda says.
“Even graduates, we’re not getting many grad roles. They want CSMs [client services managers] that have 12-18 months minimum experience; that’s a tight market.”
Gvalda added there isn’t as big of a talent pool either since much of the new talent coming through have been studying advice at university and want to become associate advisers rather than pursue the traditional support pathway.
“That’s putting a lot of pressure on paraplanners who in some cases are wanting to become advisers and looking to move into associate roles, then you’ve got CSOs [client support officers] and CSMs that are looking to step to paraplanning or associate advice,” Gvalda says.
“The more junior roles of paraplanning and client services… we’re seeing an under supply of talent as well because of a lot of candidates – as advisers have left the top – businesses have tried to fill those gaps and then they’ve taken people who are already in supporting roles.”
Salary and supply
Gvalda noted the rise in salaries over the last few years given that demand stayed similar or increased and supplied decreased. “Therefore, salaries have gone up because of that,” he says.
The industry has lost over 10,000 advisers since the final report of the Hayne royal commission in 2019, including 600 over the last year which has further impacted the potential pool recruiters have to work with.
“At the moment we’re probably working on one-third adviser roles that we would normally work on,” Vivere’s Gordan says.
While women are in-demand for firms that want to boost diversity, Gvalda says the competition between firms isn’t creating a net benefit for the industry.
“The problem is that when you’re still 80-90 per cent males in the industry you’re just taking one female from one place and putting them somewhere else,” Gvalda says.
“It doesn’t mean the whole industry is getting more diverse. That will take time as more junior candidates are coming up into the space.”
Bring your own book
For the top end of town, Gordon says senior advisers leading teams can command over $200,000 but only if they have their own client books.
“Some of the larger corporates in private wealth, they sort of work in pods that would maybe be having two or three advisers and a couple of associates and support staff,” Gordon says, specifying the leaders would be getting over $200,000.
“Within private wealth for senior advisers or team leaders, if they are looking to move business, the way their getting that salary is because there’s a high expectation for advisers to move clients with them.”
However, Gvalda notes the complexities in comparing salary offers as other KPI incentives and potential equity stakes could be on the table.
“That can be another incentive advisers but that can blur the lines around what the total compensation package is for candidates,” Gvalda says.