A new Fidelity study shows wealth management firms aren’t providing enough career development and recognition to keep advisors satisfied. In fact, only four in ten advisors are apparently satisfied with their current firms, the Fidelity Clearing & Custody Solutions study of over 400 panelists from across the wealth management industry reveals.

In particular, firms are falling short when it comes to discussing career growth for their advisors and recognizing employees for their good work.

About half of survey respondents say someone from their firm talked to them about career progress in the past six months. Just less than half say they’ve recently received recognition for doing good work.

“Six months is a long period of time” to go without a conversation about career progress, says Charlie Phelan, vice president of practice management and consulting for Fidelity Clearing & Custody Solutions.

Recruitment of new talent is another shortfall, according to Phelan. Just over half (55%) of respondents say their firm spends a considerable amount of time recruiting new talent while only 37% say their firms have been effective with their recruiting efforts to date.

“On the recruitment side of the business, the biggest driver of FAs moving to a new firm is knowing other advisors who have moved to that firm,” Phelan says. And for that reason, firms should focus on retaining their advisors through engagement, Phelan says.

For RIA Cannataro Park Avenue, this particularly holds true for young FAs, founder and partner Louis Cannataro claims.

“Unfortunately, I can’t live forever. Our firm is multi-generational and since we need the business to progress through the generations, retaining FAs, particularly young FAs, is critical for our long-term success,” he says.

Discussing career development and recognizing employees for their work is a problem across the board in every industry, including wealth management, Cannataro says.

“The next generation of advisors and employees in particular needs much more recognition to feel successful and engaged,” he says. And providing younger employees with opportunities for growth and recognition is key for RIA practices hoping to continue into the future, he says.

Cannataro Park Avenue discusses career progression by outlining their development methodology from the first day of an advisor’s employment.

“For your income to increase at our firm there is a simple way to do it: Increase your knowledge and education,” Cannataro says. “Every time an advisor passes an exam or a certification there is an increase in their income,” he says.

At $500 million RIA Stavis & Cohen, the firm even encourages career growth and development in its weekly Monday morning meetings.

Deborah Stavis

“We talk for an hour and a half about what is happening around the firm. People also go around and talk about what they have learned in what we refer to as a learning corner,” Deborah Stavis, co-founder and CEO, says. Regular emphasis on learning encourages professional development, she notes. The firm also holds group brainstorming sessions to provide advisor education opportunities.

“We use a holistic planning approach and do a group brainstorming session every time we are creating a plan. It helps younger advisors who wouldn’t necessarily know what they are doing,” Stavis says.

Both Stavis and Cannataro say recognizing employees for good work is crucial.

“We have taken strides to provide points along advisors’ careers where we are recognizing them for the work they have done” beyond compensation, Cannataro says. “What I try to do for our advisors is relay to them what they have done for our clients. That’s us saying ‘Look at the difference you are making,’” he says.

The survey was conducted in 2018. Results were released today.