Core-Asset Consulting - 09-Mar-2021

Wealth management may bring new job riches to Scotland

WEALTH management could enjoy a jobs boom in Scotland, with experts predicting national firms are likely to set up regional hubs here as part of a post-pandemic recovery strategy.

As the sector faces the challenges of destabilising lockdown job cuts and the likely exodus of many senior figures left jaded by the pandemic, the landscape is ripe for radical changes.

Now an influential report for the financial services sectors is predicting that a confluence of factors is likely to persuade major players to set up distinct Scottish hubs, sparking a “domino effect” style sector revival.

The bold projection is included in the sixth Annual Salary Guide into Scotland’s financial service sector from Core-Asset Consulting. It is a forensic review of salary levels and also a gauge of market sentiment, activity and the themes that are impacting financial services across Scotland.

Jack Anderson, a consultant specialising in wealth management at Core-Asset, said: “With UK regional travel restrictions currently in place, and the possibility of a Scottish Independence referendum pending, there is a strategic argument for a number of national firms to establish regional offices north of the border.

“These regional hubs would offer the ability to service local Scottish clients at source, and from a health and wellbeing perspective also offers the opportunity for those employees who are perhaps based in London, or in cities elsewhere, to relocate to more rural and less densely populated areas.

“New market entrants have somewhat of a positive domino effect, creating movement and opening opportunities across the board.”

The eagerly anticipated report points out the scale of the crisis caused families and individuals across the country to rethink personal health, wealth planning and succession planning.

However, it also has a profound effect on many working within wealth management and the report predicts that staff at all levels of seniority are taking stock, reviewing life choices and Jack added: “It is anticipated that during 2021 and into 2022, we will see a number of experienced individuals leave the industry or take early retirement as they reprioritise.”

That will add to existing uncertainty after many firms cut back on staff numbers, particularly in the first half of 2020. Demand for candidates across the wealth management sector stalled in the wake of the first Government lockdown in March 2020. Roles in supporting capacities were particularly hard hit as assets under management and new business slowed.

Jack added: “These decisions to reduce headcount did have a destabilising effect on the sector overall and has led to an increased pool of immediately available candidates.

“However, as 2021 approached there was a definite shift and we saw demand for experienced investment managers and financial planners who could bring a book of clients with them.

“Enticing and attracting these individuals to move companies is a complex and challenging task that requires detailed negotiations on both sides, even more so when conducting ‘face to face’ business is all but impossible.”

As the sector emerges from the pandemic, the report states that companies will have to embrace rapid changes in technology and Jacked added: “The wealth management industry today is more regulated, and in a better operational position than at any other point during its history.

“But to meet the continued challenges of this crisis firms will need to embrace the latest technology or run the risk of disenfranchising even the strongest client relationships.

“People are a private wealth firms’ biggest strength. If anything, Covid has emphasised that while technology can augment and supplement work, it does not replace what is needed from people.

“For private wealth managers this crisis has highlighted a greater appreciation for the fact that people and technology are more powerful when working together than either can be on its own.”

Other opportunities are also likely to materialise, according to the report. A number of financial products have been in high demand – particularly financial protection, which has done exceptionally well throughout 2020. This has been partly driven by government stimulus packages and duty relief on home buying.

Core-Asset Consulting was formed in 2005. Based in Edinburgh, it is now a £14m business employing 22 people and works across the entire financial services sector, from the smallest boutiques to the biggest global players.

Initially the firm carved its reputation in Scotland’s globally-renowned asset management sector. However, the success of its model allowed it to expand across the wider financial services market. It now boasts dedicated accounting, investment operations and finance teams and also works in Scotland’s thriving legal sector.

To register to receive a copy of the full Industry Trends and Salary Guide report, please click here.