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Industry Spotlight > Broker Dealers

Fidelity Poll: Broker-Dealers and RIA Firms Focused on Hiring in 2011

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A new Fidelity Investments survey finds three quarters of U.S. broker-dealer and independent RIA firms are planning to hire up to 30% more employees over the next 12 months. The poll was conducted at Fidelity’s 13th Annual Executive Forum client event held May 2-4.

According to the poll, firm executives reveal that their No. 1 staffing priority in 2011 is to recruit new advisors and brokers that have existing books of business (43%), followed by 19% who plan to mentor and help existing staff transition to a broker or advisor role.

Nearly one-third (32%) of broker-dealers and RIAs say that ongoing industry consolidation has made it easier to recruit, while 62% say it has had no impact.

“A strong focus on recruitment, especially as a component of a broader client acquisition strategy, is extremely good news for the industry and speaks to an overall confidence for its continued growth and success,” said Scott W. Dell’Orfano, executive vice president of sales with Fidelity Institutional Wealth Services, said in a statement.

The poll found broker-dealer and RIA firms say that adding new clients will be their No. 1 driver of profitability this year (60%), a 17 percentage point increase over 2010. Firms expect adding new brokers and advisors will be their second biggest driver of profitability at 21%, up from 14% in 2010. While broker-dealer and RIA firms see client acquisition and broker recruiting as their two biggest drivers of growth in 2011, these are also their top two areas for concern this year.

“There is no doubt money is in motion, whether from investors moving firm relationships or brokers and advisors going independent and bringing client assets with them,” said Bobbi Masiello, executive vice president of relationship management with National Financial. “Regardless of the business model they choose, we are able to work closely with our clients to offer them the resources, such as a sophisticated technology platform, they need to help them aggressively recruit brokers and advisors, as well as attract affluent investors.”

Planning for Succession

The Fidelity poll finds that more than half (53%) of broker-dealer and RIA firms do not have a long-term succession plan for their business in place. Thirty percent state they have an agreed upon succession plan to pass their business on to senior team members, while 15% are currently exploring opportunities with a potential merger partner.


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