Study identifies three steps to help address an emerging issue
September 26, 2014 – BOSTON–(BUSINESS WIRE)–Fidelity Investments® today released results of its Recruiting Redefined study, the first study to look at the full recruiting ecosystem of the financial advice profession, surveying Gen Y college students and young professionals, career influencers, new advisors and firm hiring managers.
The study found that it is lack of awareness among Gen Y talent – not the more commonly perceived lack of interest – that is fueling the advice industry’s talent shortage. Only two out of 10 college students and young professionals surveyed were familiar with the advisor profession, but after simply learning more about it, nearly half would consider it. The Recruiting Redefined study dispels common myths about the recruiting landscape and identified three steps to help attract talent to the financial advice profession:
- Re-Focus on Different Talent Pools: Firms may want to consider candidates from outside the traditional talent pool – the strongest talent may be working in an adjacent field
- Reposition the Advisor Profession: Gen Y talent is interested in the advisor profession, just not interested in how firms are describing it as a sales-focused role
- Re-Engage Talent in a New Way: The recruiting landscape is changing, calling for firms to approach networking and referrals in a new way to recruit the right talent
To help firms apply these strategies, Fidelity Institutional is working with Certified Financial Planner Board of Standards, Inc. (CFP Board) on a new CFP Board online destination for those interested in the advisor profession, the CFP® certification and job or scholarship opportunities.
“The truth is that the looming talent shortage in the advice industry is no longer looming—it’s here, and the typical approach to recruiting is no longer effective,” said Jylanne Dunne, senior vice president of practice management, Fidelity Institutional Wealth Services. “It’s time that we redefine our recruiting efforts so we can begin to make real progress that could benefit the profession for the long-term.”
MYTH 1: Candidates Need Certification Just to Get the Job
According to the study, hiring managers and recruiters are struggling to find qualified talent, ranking “lack of necessary skills” as their No. 1 recruiting obstacle. Candidates who already have a certification like the CERTIFIED FINANCIAL PLANNER (CFP®) certification may be perceived as more desirable, but the study found that young professionals in adjacent fields like insurance and banking may be a qualified talent pool if firms provide them with a pathway to certification. The study found that these young professionals, who average 2.6 years of work experience, are in the market for a new job (91 percent), and they:
- Perform Well: 75 percent of hiring managers surveyed said they outperformed advisors recruited directly out of school
- Can be Recruited From: Financial and insurance jobs (No. 1), retail trades (e.g., banking) (No. 2), professional, scientific and technical services (No. 3)
- Thrive with Support: 85 percent of new advisors surveyed are happy with the professional development support they receive from their firms; new advisors who don’t take the CFP® certification exam said their firm didn’t encourage or require them to attain the credential
MYTH 2: “Today’s Talent is Not Interested in the Advisor Profession“
The study found that Gen Y’s lack of interest is not for the advisor profession itself, but in how firms describe it. The study identified how firms can make the profession up to 50 percent more appealing to candidates: re-position how they talk about the profession to cater more to Gen Y; specifically, tone down the sales aspect of the job.
Among the top reasons candidates surveyed would not consider becoming an advisor were “too much pressure to sell” followed by working on commission. Meanwhile, firm hiring managers cited “sales ability” as a top attribute in evaluating potential candidates. After reading a revised, hypothetical job description that de-emphasized sales and was more aligned with attributes Gen Y candidates are looking for, such as work/life balance, 51 percent of students and 40 percent of young professionals surveyed found being an advisor more appealing.
MYTH 3: Traditional Recruiting Strategies are Still Effective
The study confirmed a lack of awareness of the advisor profession among candidates, with six out of 10 college students reporting that they could not name a firm that employs advisors. This new reality calls for new recruiting strategies that can help to bridge the gap between firms and candidates. The study identified how firms can create ambassadors in the community and take a fresh approach to networking in order to find the right talent.
- Let Gen Y Advisors Do the Talking: Eight in 10 young advisors surveyed said their experience is much more positive than expected and describe their job as intellectually gratifying and one that allows them to help people, two job attributes among many that align with Gen Y interests.
- Engage Career Influencers: Gen Y candidates ranked family and friends as most influential when it comes to job advice, followed by college professors and career counselors. Currently, only 32 percent of firms are effectively engaging career counseling offices.
- Re-Envision Networking: According to the study, networking is a top recruiting resource for both candidates and firms; however, only three out of 10 new hires come from referral networks. Gen Y candidates are leveraging networks like social networking sites and student/alumni directories, which are underutilized by firms.
To access the findings for the Fidelity Recruiting Redefined study, visit here. Advisors can find considerations on how to redefine their recruiting efforts, as well as perspectives on the talent shortage from surveyed college students, young professionals, career influencers, young advisors and firm hiring managers.
About the Fidelity Recruiting Redefined Study
The 2014 Fidelity® Recruiting Redefined study is based on multiple research methodologies including four in-person Focus Groups with 44 participants in total and four Online Quantitative Surveys with 600 participants in total. Research participants included hiring decision-makers at financial advisory firms, new financial advisors, students (College and MBA), young financial professionals, college counselors, and career counselors interviewed from April through June of 2014. All of the research was ‘blind’—Fidelity was not identified as the sponsor during any phase. The study was administered by Greenwich Associates, an independent firm not affiliated with Fidelity Investments.
About Fidelity Investments
Fidelity’s goal is to make financial expertise broadly accessible and effective in helping people live the lives they want. With assets under administration of $5.0 trillion, including managed assets of $2.0 trillion as of August 30, 2014, we focus on meeting the unique needs of a diverse set of customers: helping 23 million people investing their own life savings, 20,000 businesses to manage their employee benefit programs, as well as providing 10,000 advisors and brokers with technology solutions to invest their own clients’ money. Privately held for nearly 70 years, Fidelity employs 41,000 associates who are focused on the long-term success of our customers.