The title of largest head count in the industry has changed hands in each of the past three quarters among the three giants of the wirehouse, regional and independent broker-dealers.

Morgan Stanley, Edward Jones and LPL Financial have a combined 47,856 advisors, representing 16% of the 300,776 in the entire industry. But if they’re waging a head count race — and they’re not outright admitting to any contest — they’re staying in their own lanes with varying headwinds.

Edward Jones’ U.S. force of 16,133 advisors at the end of the second quarter placed it above LPL, which enjoyed the largest headcount of 16,067 advisors after the first quarter. LPL had previously overtaken Morgan Stanley, the leader following the fourth quarter of last year with 15,712 advisors.

Largest BD head counts

The firms are moving in opposite directions on the closely-watched metric. Morgan Stanley’s head count has slipped 1% year-over-year to 15,632 advisors, while LPL’s has jumped 13% to 16,049 and Edward Jones’ has surged 10% to 16,133.

The firms, though, may not want the largest head count. The number of advisors is “important but not most important” to the firms, says recruiter Jodie Papike of Cross-Search, noting profitability, retention and advisor satisfaction as other major elements. She compares a large head count to a double-edged sword.

“When you have the scale, you have a lot of name recognition,” says Papike. “You’re going to get a lot of advisors who are attracted to you because of that. But the challenging part is keeping your advisors happy and not just feeling like they’re a number.”

Edward Jones has received more positive feedback from advisors in independent surveys, beating both LPL and Morgan Stanley by more than 200 points in J.D. Power’s latest annual advisor satisfaction study. The St. Louis-based firm’s U.S. head count has also further expanded to 16,175 advisors since June.

Retiring Edward Jones managing partner Jim Weddle, who will give way to Penny Pennington next year, has said the firm isn’t focusing exclusively on hitting the goal of 20,000 advisors by 2020 it stated three years ago.

The firm does, however, see advisors as the “economic engine of our firm,” Weddle said in an email, noting the growth of FA head count as one of three key measures, alongside client assets and deeply served clients. Weddle says the firm’s research shows 40 million potential clients in the U.S. and Canada, nearly six times its current number.

“We don't pay attention to anyone else's growth but our own,” he said. “We are serving seven million [clients] so we have a lot of work to do and need to be larger to serve them. We want to be the first choice of that targeted investor, but that does not necessarily mean we will have the most FAs.”

On the other hand, Edward Jones’ status outside the Broker Protocol often turns advisors off, notes recruiter Mark Elzweig. Morgan Stanley had followed fellow wirehouses UBS and Merrill Lynch in pulling back from their traditional recruiting, and the firm became the first wirehouse to leave the agreement last October.

Other than at Wells Fargo, which has lost more than 300 advisors in the past year but continues to recruit aggressively, the movement of advisors between wirehouses has narrowed to so-called franchise advisors with about $1.5 million in annual production and high fee-based assets, Elzweig says.

“The other wirehouses are only interested really in cherry-picking top producers,” he says. “There’s a great desire among wirehouses advisors to either go to regional firms or to go independent. A lot of wirehouse advisors, if they make a move, want a more radical change in their venue.”

A spokeswoman for Morgan Stanley had no comment, while a spokeswoman for LPL said many members of the executive team were on summer vacation following the firm’s annual Focus conference.

In a speech at the event, CEO Dan Arnold told the roughly 3,600 advisors in attendance that he recognized that the firm’s culture didn’t align with its strategy after conducting a full internal assessment and gathering feedback from advisors.

“In order to execute our strategy, we’ve got to change how we work,” Arnold said. “We are transforming our culture to one that puts you and your needs at the center.”

LPL’s $325 million acquisition of the assets of National Planning Holdings made its head count larger than any wirehouse, but longtime recruiting executive Bill Morrissey is retiring this month after the firm retained about 150 fewer advisors than the expected 2,000 from NPH.

The firm is also boosting its recruiting offers to prospective advisors, pledging to spend some $125 million this year on technology and striving to make 100 more improvements to its services for advisors after making 100 in 100 days in the second quarter.

Papike and Elzweig, the recruiters, agree that advisors differ on their level of interest in large firms based on prior experiences or their particular needs. The rising consolidation of the past five years has also prompted more advisors to ask about the ownership of their prospective firms, Papike says.

“Advisors want the best of the both worlds,” Papike says. “They want a firm that’s stable and strong, but they also really want to feel like they’re a part of something.”