We’re Hiring: Schwab RIA Study Finds
Hungry for new talent, registered investment advisory firms are casting a wide net to ensure they fill their needs, with the top businesses providing new candidates packages that include more than just compensation, according to Schwab Advisor Services’ 2023 RIA Compensation Report.
While 77% of RIAs hired new employees last year, 75% said they planned to do so in the future. After attracting clients through client recommendations, adding new people to strengthen the firm’s skill set or capacity was the second most significant focus for RIAs this year.
One in four RIAs went to rival RIAs for more experienced staff, and one in three went to colleges and universities, the highest since Schwab began the survey. Personal or professional networks, on the other hand, were named by 56% of respondents as a channel they relied on for new hiring.
When it comes to attracting fresh talent, RIAs rely on a number of employee value proposition features, not simply remuneration, though Schwab concedes that it’s “often the benefit candidates most value.”
Other advantages offered to attract fresh talent include 401(k) plans, which are offered by 80% of respondents; remote or hybrid work opportunities, which are supplied by 75%; fully paid parental leave, which is offered by two-thirds of RIAs; and career path or progression prospects, which are offered by 75%.
When it comes to existing employees, despite compensation costs accounting for 69% of a firm’s expenses last year, upgrading their skills and capacities was ranked sixth this year, up from eighth last year and 10th in 2021.
The median annual training, education, and professional dues spend per staff member was $1,300 at businesses with less than $250 million in assets under management and $2,100 at those with more than $250 million.
“Competitive compensation is central to a strong employee value proposition and is a key factor to attract and retain talent in today’s market,” said Lisa Salvi, managing director of Business Consulting and Education at Charles Schwab Advisor Service.
The report is based on responses from 1,044 advisory firms that participated in the compensation section, accounting for 80% of those who participated as a whole (1,300). The study was performed from January to March 2023 on about 14,500 employees in 27 roles characteristic of RIAs.
