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Around 1,000 adviser jobs will be lost in 2010 as firms seek to make their business more profitable, according to Plimsoll.
The research firm believes IFA practices will experience a resurgence, but jobs will need to be lost if the sector wishes to remain competitive.
After the impact of the credit crunch and recession, IFAs have had a tough two years, Plimsoll says, but things are set to get better.
However, many firms are barely surviving the recession, according to senior analyst David Pattison, and consolidation will be a major theme in 2010.
This will help improve efficiencies, but is likely to lead to major job losses, he adds.
"Our latest analysis projects that a further 1,000 jobs will have to be shed if companies are to get back to profit and remain competitive in 2010," says Pattison.
"Whether through natural wastage or compulsory lay-offs, job losses are necessary. With the average sales per employee figure down to £87,000, employees need to ‘buy in' and contribute more to the recovery of their companies - if you still have a job expect to work much harder in 2010."
Plimsoll believes the market will strengthen through 2010, with 512 companies rated as strong in its latest report. These firms are expected to lead the recovery and take advantage of the opportunities on offer.
IFAonline readers are entitled to a £50 discount on the Plimsoll Industry Analysis - Independent Financial Advisors. Call 01642 626400 for further details and quote reference PR/FL36.
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Plimsoll report
Sorry to disagree Harry but I'm afraid we've just lost 3 advisers who have had enough after two years of 'trying to keep it going' and as a result we have had to lay off two admin staff. I'm sure we are not alone in this.
Posted by: Tony Joannou
IFA's giving up
I entered the industry in Feb 1973 as a commission only salesman for Save and Prosper.I am 64 and have no intention of trying exams. Whether I will 'leave the industry' depends upon how you define involvement. I am afraid that the academeics got hold of this industry 10 or 15 years ago. If the same adcademics who got hold of us had gotten hold of the driving test, for example, learner drivers would have to answer questions about the chemical formula of petrol and motor vehicle production with intensive month long courses at the MIRA test centre. And I would have to retake the exam every couple of years.Instead. lunatics are let loose causing mahem on the roads.A smart government would pay people like me to use our experience to give generic advice. Like getting the low take-up of benefits by the elderly population who currently don't claim.
Posted by: Peter Morris
Professionalism
Setting higher standards is the only way to make this sector truely professional. Hopefully the next 10 years will move us onto the next level and we will hopefully shake off the shady past of the 1980's and 1990's IFA. I see no reason why Chartered Status should be the minimum standard to run your own firm.
Posted by: Jim Murphy
The Infallibility Exam
Setting higher standards may be the only way to make this sector truly professional but there is only one way to survive. The CII or whoever needs to devise an exam whereby IFA's can sniff out the increasingly devious conmen and scammers before the regulator,police or serious fraud office are able to do so. Otherwise you can have qualifications to the eyeballs but always remain the fall guy when the sh one t hits the fan.
Posted by: David McMeekin
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Oh save me!
Nonsense statistics yet again from these people. How many retire anyway in a normal year? What is the age group of those who say they will be dropping out? If you take out normal retirement and early retirement what are you then left with? This would be the true figure attributable to RDR erosion – the rest is just hype and publicity spin.
Posted by: Harry Katz