After a slowdown last year on hiring trainees to turn into full-fledged financial advisers due to Covid-19, Edward Jones said on Friday it would tread gingerly back into that part of the market for new advisers.
The company for decades has been known as a destination for second-career advisers, turning schoolteachers and firemen into registered reps to work in one-adviser offices across the United States. But training financial advisers takes time and is also expensive, with a high percentage of trainees typically not making the cut.
According to the annual report for the Jones Financial Companies, the private partnership that controls the broker-dealer Edward D. Jones & Co., "in response to the Covid-19 pandemic during 2020, the partnership implemented measures to optimize firm resources and control costs, including a temporary pause on the recruitment of non-licensed financial advisors."
This may have an ongoing impact in 2021 on the firm's financial adviser growth, according to the report, which was filed Friday afternoon.
And the firm is cautiously increasing hiring at the moment, according to the report, essentially hiring but at a lower rate than in the past.
Edward Jones is "gradually restarting hiring to enable it to prioritize support for all financial advisers, which may result in fewer financial advisers hired than historically experienced," according to the filing.
2020 was a tough year for hiring across the financial advice industry, in large part because of the uncertainty caused by the pandemic and a stock market that fell sharply in the first quarter and then rebounded to record highs by year-end.
Basic ways of doing business also got adjusted. A number of firms made changes to work policies, and Edward Jones last spring asked advisers to suspend in-person meetings with clients.
Despite the difficulties of operating during the pandemic, Edward Jones was able to increase the number of full-time employees, including financial advisers, to roughly 50,000 by the end of December, compared to 49,000 a year earlier, according to the last two company annual reports. Over the same time, the firm, a private partnership, increased the net number of financial advisers by 521 to 19,225. That was a 12 month increase of 2.8%.
Meanwhile, Edward Jones is also revamping its pay package to recruits with work experience as financial advisers. Edward Jones recently said the new compensation plan would feature a salary for those recruits, plus opportunities for increased cash flow.
"There's no grid, just the salary," said Don Aven, principal, experienced financial advisor talent acquisition, in a recent interview.
The new plan also doesn't feature a forgivable loan to experienced advisers, so they are free from that commitment, he added. "We're excited about the enhanced compensation and transition structure," Aven said.
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