The past few years have been booming for Bogart Wealth, a McLean, Va.-based firm that targets energy company employees with defined benefit plans: Assets are around $2.1 billion, versus about $700 million 2 1/2 years ago. To keep up with demand, CEO James Bogart had to hire. With a still tight labor market, however, this required work, ranging from a revised bonus package to a new career development program.
But while Bogart has been able to increase its workforce, from 12 employees before the pandemic to 28 now, it still needs more people – and its staff shortage has, ironically, slowed the launch of a career development program aimed at to stimulate recruitment and retention. “Had we had more capacity internally, we would have launched the program fully in the first quarter of this year, instead of rolling it out now,” Bogart says.
With an unemployment rate of 3.6% at the time of writing, the labor market remains tight. And, although some advisers say that in recent months they have started to see more candidates applying for open positions, hiring remains a difficult proposition for consulting firms. With this in mind, many companies are still getting creative with filling vacancies and keeping existing staff on board. “Our clients hire a lot of people,” says Chris Bisenius, recruiter at Winward Recruiting, which specializes in wealth management and financial services. “And they become more creative.”
When it comes to hiring, many advisors find it easier to seek out younger employees. Take JSF Financial. When the Los Angeles-based company, which has about $4 billion in assets, experienced above-normal revenue last year, company founder Jeff Fishman discovered that it was not difficult to find candidates. What was difficult was attracting industry veterans, like the head of customer service who was leaving with 12 years with the company. So he decided, among other measures, to hire less experienced candidates who could take on technology tasks, freeing up time for more experienced operations and customer service staff. “Generally we were looking for people with experience in the past,” he says. “But we realized we were hiring the person, not their experience, and most of what we do can be taught.”
The difficulty of recruiting staff can depend on a combination of workplace policies and location. For example, job applicants in areas where the population is more sensitive to masking and similar COVID-19 issues may be less willing to work full-time or part-time in the office than those in other areas. As a result, councilors who have imposed back-to-office hours in these localities sometimes find it harder to fill vacancies. Bogart, for example, implemented a full-time in-person policy in September 2020 and says he’s found it easier to attract people to Houston, where locals are more than willing to work locally, than his MacLean, Va., the location, an area with a preference for hybrid and offset mounts.
Some large companies take more elaborate measures. In May, Raymond James launched Admin Extension, a program providing advisors with remote administrative support from seasoned administrative professionals. Called “AdminExt Branch Associates”, they are trained to manage processes used across the company, replace administrative staff who take time off, work on specific projects that require more staff, and step in when branches need short of staff need help. .
Take Connor Jarvis, partner at Wright LaHaie Jarvins Wealth Advisors in Canton, Ohio. Shortly after launching Admin Extension, his company began interviewing support people. A key employee was about to go on maternity leave and Jarvis realized he didn’t have much time for a new hire. “We knew it would probably take longer than expected, given the state of the labor market,” he says. He ended up exploiting the program, which provided him with someone to temporarily fill the void.
It is more profitable to keep staff than to hire new ones. Replacing an employee can cost up to twice their salary, according to Gallup. Consulting firms are therefore stepping up their efforts to make their offices attractive places to stay.
With this in mind, career development is a big area of focus. Donnie Ethier, senior director of wealth management research and advisory at Cerulli Associates, has seen an increase in programs pairing rookies with more experienced advisers, especially in distribution centers and larger corporations. “There is a big push towards mentoring,” he says,
MAI Capital, a Cleveland-based company with approximately $13.4 billion in assets, is one such operation. Most of its more than 300 employees are 45 or younger. “What this young talent wants is to learn and grow,” says Lesa Evans, the company’s director of human resources.
Last year, the company launched an educational initiative giving employees access to 1,600 online and in-person courses, as well as an optional career planning program for recent graduates, who work with senior executives. on how to continue their current career trajectory or change direction. . Evans points the finger at a financial planning employee who, as a result of these discussions, recently decided to get a CFP, to better switch gears and become a financial advisor. So far this year, five employees have changed paths through the program and started doing different jobs.
Bogart recently introduced a three-year program for customer service and operations personnel who wish to become advisors. “The younger generation wants to know what their path is to becoming a financial advisor,” he says. The program involves stints in various departments, such as financial planning and portfolio management. After that, participants move on to more direct work with clients, attending meetings with experienced advisors, and helping with client communications and other tasks.
Another approach is to give employees more say in company decisions. To that end, about a year ago, MAI began involving staff more in a variety of projects. Last year, for example, Evans turned to a group of about 30 employees across the company’s 17 offices to get their ideas on the best ways to introduce a new bill payment system that the company was considering. “It’s all about employee engagement,” she says.
Many advisors are re-evaluating their compensation programs as part of their recruitment and retention efforts. Brandon Kawal, director of Advisor Growth Strategies, which works with growth advisory firms, says he’s seeing more and more clients asking for the most up-to-date compensation data he can find, instead of use research from the previous year. “They ask, how can we get the most current trends possible,” he says. Companies offer higher salaries and better benefits, such as increasing a 401,000% match from 3% to 6%. And, they are increasingly building in partnership or equity as part of long-term plans. “Even though it’s a small percentage of ownership, you feel like you’re an important part of the business,” says Bisneius.
For his part, Bogart recently overhauled its employee bonus program. While payment was based on both company performance and individual performance, after feedback from current employees, he separated the two into different programs.
Of course, there are limits to the compensation companies can offer. For this reason, when employees reveal that they have been offered a job elsewhere, Evans will not automatically make a counter-offer. Instead, it weighs the value of the individual against the cost to the business. “We’re very strategic about where we place our bets with counter-offers,” she says.