As many as 11,000 wirehouses advisors may be on the move, according to a report by Aite Group in Boston.
Job satisfaction is a problem. While 15% of wirehouse advisors are very satisfied with their firm and have no intention of leaving, most aren’t so fired up about their employers. In fact, 20% say they’re ready to break from their firm within the next two years.
These aren’t all lower producers, either. Aite finds that 10% of “locked-in” advisors, those with retention packages, are as likely to quit their firm as the 28% of wirehouse advisors without golden handcuffs. More than two-thirds of locked-in advisors say there’s a chance they’ll leave. Most advisors think they can take half of their books with them to a new firm. However, only 23% are considering quitting the wirehouse channel altogether, mostly to go independent.
“We asked for reasons why they’d want to break away and most are looking for a better payout or to go independent so they have more say over how they run their businesses,” says Alois Pirker, research director at Aite. “Wirehouses’ tarnished brand was No. 3.”
However, Pirker said that many wirehouse brokers are loyal to the channel. With hiring between firms at a minimum right now for all but the highest producers, many advisors will just stay put.
“There’s not much wirehouse-to-wirehouse poaching, so if you see your future in the wirehouse channel, stay where you are.” For wirehouse reps willing to live without the cache of a Wall Street name, though, non-wirehouse broker-dealers are now hiring aggressively. “There are many opportunities if you’re willing to look at other channels,” Pirker said.