Employee advisors with production greater than $1 million gave their firms worse job satisfaction marks than their lower-producing colleagues,
J.D. Power’s annual survey linked the growing discontent to the
The space is “in a period of transformation,” Foy says. “There are things happening that have the potential to change the fundamental nature of the industry.”
More than 2,700 advisors submitted answers through mail and email surveys between January and April, he notes. Each advisor rated their firms on a 1,000-point scale in seven categories, including pay, leadership, professional development, technology and client support.
Click through the slideshow to see how the changes have roiled advisors' attitudes about their firms.
“The bigger gaps are really related to the leadership and the culture,” Foy says. “One advantage that firms like Edward Jones and Raymond James have is that their primary business is wealth management.”
J.D. Power also spoke with independent advisors at Raymond James Financial Services, Cambridge Investment Research, Cetera, Advisor Group and the Wells Fargo Financial Network. The firm did not receive enough answers from advisors at those firms to include the firms in the rankings, Foy says.
Both groups’ satisfaction dropped three points this year. Satisfaction among independent advisors has fallen by 26 points since 2014, while satisfaction among employee advisors has ticked down by only two points in the same span.
Such advisors’ satisfaction shrank 27 points over the past year, while the lower-producing advisors reported only a nine-point reduction.
Lower-producing employee advisors in particular gave their firms 9% higher ratings for operational support. The negative correlation between production and satisfaction jibes with past surveys of advisors, according to Foy.
Firms are “very valuable to FAs at the start of their career” but become less so as advisors advance in the profession, he says.
The 49% of employee advisors whose payout rules stayed the same or improved gave their firms an average rating of 824. On the other hand, those displeased with the compensation changes at their firms gave an average overall score of 618.
“It’s a persistent problem,” Foy says, noting that
“In many cases, advisors feel like either executive management doesn’t value what they do or doesn’t put them at the center of what they’re doing,” he says.
Independent advisors reported that they don’t completely understand the rule at a higher rate than employee advisors. And 63% of independent advisors expect the rule to cut into profits at their firms, compared with 58% of employee advisors.
The rule has prompted firms to