The financial services industry is not renowned for its diversity.
If you asked the average person in the street to describe a financial adviser for example, many would likely conjure up an image of a grey haired man in his 50s. Of course, there’s nothing wrong with this view per se.
However, if we as an industry are to tap into the increasingly important market of millennial clients and build a loyal, long-term relationship with them, we need to make sure they feel represented by our industry.
This means recruiting staff who are going to understand their needs and be on hand to develop suitable products and deliver the most appropriate advice as millennials hit major milestones in their lives. Firms therefore need to hire millennials themselves.
Unfortunately, recruitment in general is something many struggle with.
When we polled financial advisers at our recent investment conference, 92 per cent of respondents said that recruiting appropriate staff was the biggest challenge to growing their business.
If urgent action isn’t taken soon to attract the next generation into the workforce, the problem is only going to get worse as existing professionals retire.
So how can we improve the way we attract bright young graduates?
First, we need to create firms younger people want to work for. A number of surveys, including one by Upwork in 2015, have shown that millennials’ values differ from those of older workers.
They are less motivated by a job for life, but highly motivated by the idea of a work-life balance as well as a sense of purpose. Creating a less hierarchical structure, one that harnesses the ideas, passion and energy of this younger generation, could be a way to recruit – and retain – the next generation of advisers.
However, as an industry, we face a number of unique challenges to recruitment that must be addressed. First, there is a low level of trust from consumers and we really need to demonstrate that we are taking steps to create a fairer, more customer focused environment.
Bringing younger people on board, many of whom had not yet entered the workforce during 2008, will show that the financial world is literally changing: the people working in the industry are no longer those who were around at the time of the banking crisis.
Second, the rise of ‘digital disruptors’ such as robo-advice could potentially threaten the revenue streams of many traditional advisers.
However, as digital natives, younger advisers will not only be comfortable with the technology, but are likely to embrace it and find innovative solutions for its millennial clients who are keen to take advantage of robo-advice and other online services.
Third, the industry needs to actively engage with those yet to enter the workforce and develop genuinely appealing apprenticeships and graduate trainee schemes. This is something Thesis has done for some time, offering work experience programmes for students at school and regularly presenting at schools and colleges in a bid to get young people thinking about a career in finance.