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Edward Jones Restarts Advisor Hiring After Q1 Headcount Dips

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What You Need to Know

  • Edward Jones paused hiring of non-licensed advisors to cut costs due to the pandemic.
  • Its current approach to hiring may result in fewer news hires than in the past, it says.
  • The firm says it's investing in resources for advisors, including to boost virtual business.

Edward Jones has resumed hiring financial advisors after putting the brakes on recruiting in 2020 as part of cutting costs in response to the COVID-19 pandemic, the firm disclosed Friday.

The number of Edward Jones financial advisors fell by 60 in the first quarter of 2021 to 18,967, down from 19,027 a year ago, while total client assets under care soared 40% to $1.618 trillion from $1.157 trillion, according to a 10-Q filing with the Securities and Exchange Commission by parent firm The Jones Financial Cos.

Edward Jones “implemented measures to optimize firm resources and control costs, including a temporary pause on the recruitment of non-licensed financial advisors during 2020,” an Edward Jones spokesperson said.

However, the company “remains committed to financial advisor growth to continue to serve existing clients and future clients and create a positive impact in our communities by hiring both experienced financial advisors and non-licensed candidates in future periods,” the spokesperson explained.

Therefore, Edward Jones has “restarted hiring and is committed to an innovative and intentional strategy to grow its impact by offering a plan and resources for both current financial advisors and new hires,” the spokesperson said.

Despite the resumption of hiring, the approach it is taking “may result in fewer financial advisors hired than historically experienced,” the spokesperson pointed out.

Edward Jones, meanwhile, continues to invest in virtual business enablement tools to help its branch teams succeed amid the ongoing limitations on in-person client prospecting and consultations, it said.

“As we grow our impact with our clients, colleagues and in our communities, Edward Jones is taking an intentional approach to hiring financial advisors and offering a plan and resources to support their path to success,” according to Penny Pennington, Edward Jones managing partner.

“This will ensure we can serve our clients based on their unique needs and in a way that is personal and complete to them,” she said. “Our purpose calls us to deeper partnership with our clients and colleagues as we seek to make a positive impact in their lives and benefit our communities and society.”

More Q1 Results Data

Net new assets in the first quarter grew 5% to $20 billion from $19 billion, while the number of client households inched up 2% to 5.7 million from 5.6 million, the company said in the 10-Q.

Average client assets under care jumped 22% to $1.572 trillion from $1.286 trillion. Meanwhile, client dollars invested through buy and sell transactions tumbled 20% to $28 billion from $35 billion. But inflows and outflows of client dollars into Edward Jones advisory programs soared 80% to $18 billion from $10 billion.

Client assets under care “experienced a significant increase due to higher market levels in the first quarter of 2021 when compared to the lower market levels experienced at the end of the first quarter of 2020 due to the significant market volatility from the uncertainties surrounding the impacts of COVID-19,” according to the spokesperson.

Net revenue increased 15% to nearly $2.9 billion for Q1, while operating expenses increased 13% to almost $2.5 billion, mainly due to an increase in compensation and benefits expenses, according to Edward Jones.