Has there been a summer lull in recruiting? It depends on where you look. Though three of the wirehouses may have cut hiring efforts, regional firms are not slowing down.
Last week, RBC Wealth Management
Indeed, the wirehouse policy shift is reflected in industrywide stats this year. The big four firms have picked up more than 60 advisors managing over $14 billion in client assets, according to hiring announcements. Meanwhile,
"Most of our success this year is because we are active in the marketplace and we're talking to more and more advisors. We're seeing it coming to fruition," says Manish Dave, senior vice president of business development at Ameriprise.
The Minneapolis-based firm has brought in a number of sizable recruits this year, many from wirehouses. Last month, a Merrill Lynch team that managed $463 million in assets joined the firm's Roseville, California branch.
For its part, RBC's success is due in part to investments the firm is making in its technology, back office resources and platform, says Tom Sagissor, president of RBC Wealth Management-U.S.
"We have, across the board, been adding to the business," he says.
That helps RBC tell its story to new recruits, especially because the firm's current advisors will benefit, says Sagissor, who notes how referral-based the business is.
"If you tell them how you are investing in them, then you have a solid foundation for attracting top tier talent," he says.
The result has put the 1,800-advisor firm in "significant growth mode," according to Sagissor. RBC has added more new recruits in the first half of 2017 than the firm hired in all of 2016.
"To be able to serve our clients to the level of quality they want, you have to adapt. And that's what we have done," he says.
This year has seen more moves, bigger moves and more expensive moves.
150% UP-FRONT WON’T CUT IT
Other firms also are benefitting from the wirehouse recruiting drought.
Stifel, for one, has seen a spike in potential hires visiting the firm's home office, says John Pierce, head of recruitment for the firm’ private client group.
"Over the past 90 days, we've seen a dramatic increase in wirehouse advisers producing $800,000 and $1.4 million interested in joining Stifel," he says. "I would also say that our wirehouse pipeline is as full as it's been in recent memory."
The wirehouse breakaway movement, meanwhile, hasn't slowed down. And it may be benefiting from wirehouses having cut the size of the transition deals that they do offer.
"It's hard for a wirehouse to recruit with an 150% up-front offer when an advisor can go independent and within a few years recoup what they would have lost and have up to a 90% payout," says Mickey Wasserman, a recruiter based in Agoura Hills, California.
Dynasty Financial Partners and HighTower are among those that have benefited from large teams seeking assistance in going independent.
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Concerns about management dragged down job satisfaction ratings in J.D. Power’s annual survey.
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The firm isn't the only one benefiting from a still strong breakaway movement.
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The boutique firm is looking to expand to new markets, says Ryan DeVore, the firm's head of Private Client Advisors.
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Plus, firms like Ameriprise and Raymond James that offer potential recruits an employee and independent channel may have an additional edge in the current hiring market.
"Given that we have an independent channel, we can bring advisors at different cycles of their career over. Some of our independent advisors might be looking for a junior advisor or to execute a succession plan," says Ameriprise's Dave. "I think in our employee channel I would say that we are much more focused on higher level advisors in terms of productivity."
Ameriprise currently has more than 9,000 independent and employee advisers.
To be sure, wirehouses haven't entirely refrained from recruiting. They continue to pick up what insiders call franchise players, typically high-producing advisers. Still, the slowdown is noticeable to those closest to it.
"It used to be you had five or six choices. Now it's two or three," recruiter Michael King says. "I don't think they'll get back into the game until next year," he says, and he cautions it could last longer.
