'Why would you join an industry that's been bashed around?': How to solve the talent crisis

On the latest episode of the ifa Show podcast, adviser and founder of digital solution Scientiam, Nigel Baker said the demand for advice isn't slowing down despite the number of advisers  in Australia dropping below 19,000 late last year, and is predicted to reach 13,000 by the end of 2023.

Mr Baker said the businesses he speaks with are "flat out" but that the real challenge is attracting new talent and advisers into the sector.

"We've got this real gap of people who just haven't been in the industry and fair enough. For the last 10 years, why would you join an industry that's been bashed around?" Mr Baker said.

"You've got graduates coming out of uni going: 'I don't want to be a financial planner. That doesn't sound much fun.' Then the regulations are really quite tight in terms of bringing graduates into the system. They've brought in all the new educational requirements, but it's almost too specific. It needs to be a little bit broader... anyone I believe who's got a [bachelor of commerce]... or they've had their three or four years at uni, we should be encouraging them to come into the industry."

"At the moment, it's like, if you didn't do this subject at uni, you can't come in. So, that's limiting the funnel."

Mr Baker's comments come after financial services minister Stephen Jones announced that a consultation paper will be developed on education standards and the adviser exam.

Last week, Mr Jones said the government would look at options to "streamline the education requirements for financial advisers" and addressed the 30 September deadline for existing advisers to pass the exam and continue to provide financial advice, saying that following the deadline, he will ask Treasury to explore how the exam can be improved, such as reducing the number of questions.

The announcement was met by a mixed reaction from industry stakeholders.

On the same episode, Mr Baker said the "shake-up" of the industry has called for a new regulatory framework; one that supports and emboldens advisers.

"It would be great to have a future of the industry where there's more trust, I suppose," Mr Baker said.

"The regulators trust the industry and say: 'You've got to be able to help more people. Some people don't need full advice and some people do and we're going to trust the advisory industry to better work that out.' Just like, if you're a doctor, you can say: 'You've got a headache, go back to the chemist.'"

Listen to the full episode with Mr Baker here.

Neil Griffiths

Neil is the Deputy Editor of the wealth titles, including ifa and InvestorDaily.

Neil is also the host of the ifa show podcast.