WASHINGTON D.C. - Phillip J. Purcell, chairman and CEO of Morgan Stanley Dean Witter of New York, and Charles R. Schwab, chairman and co-chief executive officer of Charles Schwab of San Francisco said their recent decisions to cut jobs were among the most regrettable of their careers.

Speaking at the general meeting of the Investment Company Institute of Washington D.C. last week, both executives said the layoffs were the first in both companies' histories. Schwab was forced to cut 3,000 positions or 13 percent of its staff, according to the company chairman. Morgan Stanley was forced to cut 1,500 positions, according to Purcell.

The executives also discussed the future of the financial services industry. Although mutual funds will always be an important product for American investors, managed accounts are growing at a faster rate because of some of the tax advantages they offer, Schwab said. In the next three to five years, the fund industry will continue to grow at approximately three to five percent annually, Schwab said.

Subscribe Now

Access to premium content including in-depth coverage of mutual funds, hedge funds, 401(K)s, 529 plans, and more.

3-Week Free Trial

Insight and analysis into the management, marketing, operations and technology of the asset management industry.