Shortage of quality recruits hurts IFA firms

Shortage of quality recruits hurts IFA firms

Financial advisers are increasingly struggling to cope with their workload due to a shortage of quality new recruits coming into the profession, Nucleus has warned.

Garry Mcluckie, communications director at Nucleus Financial, has claimed the biggest issue facing advisers today is capacity.

He said firms were unable to recruit staff due to a lack of appropriate applicants and as a result were struggling to meet their advice and compliance needs.

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He said: “The main thing we’re hearing from our clients is capacity problems within adviser officers. They are really struggling with recruitment so getting the right people into firms is an issue across the board and across the country.”

Mr Mcluckie said this included the advice role itself, alongside support staff and paraplanners, noting that the firm’s set up could become “quite challenging” without the correct number of staff.

He also pointed to increased regulation — such as Mifid II, the Senior Managers' Certification Regime and the General Data Protection Regulation — as a growing burden, which had resulted in increased operational overheads.

Mr Mcluckie added: “Some firms say complying with Mifid II and other regulation means they need to recruit more support staff, but they’re not able to do that because there’s not the qualified people ready to apply.

“It may well be we will see a range of people coming through the system that will be qualified in the future, but right now it’s a problem.”

Sarah Drakard, IFA at Cruze Financial Solutions, agreed, adding she had “really struggled” with recruitment and was working under capacity.

She said: “I want to see clients but spend half my time writing long reports and collecting documentation. The volume of paperwork, administration and regulation means a lot of my time is taken up with non-advisory admin, which to be honest is not what I want to do.”

Ms Drakard also said she was “struck” by how un-diverse the adviser pool was in terms of age, gender and race. 

She said: “It’s such an amazing career path so where are all the young, fresh, diverse humans? What is going to happen when the people I see at events retire?”

Scott Gallacher, chartered financial planner at Rowley Turton, agreed there was a shortage of quality staff, which he thought was exacerbated by the UK’s relatively high employment rate.

He said: “This staff shortage, coupled with a seemingly ever-increasing compliance burden, is putting pressure on advice firms and could increase the advice gap.”

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