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The financial planning profession is confronting a significant challenge – an ageing workforce that requires innovative solutions. In this blog for IFA Magazine, Steve Butler, CEO, Punter Southall, shares his thinking on why a new approach is needed if advice firms are to continue to thrive in future.
This issue of the ageing workforce in the profession is pressing as the average age of a financial adviser in the UK is 59, and retirement is on the horizon for many. In fact, one in five advisers plan to retire from the industry in the next five years[i]. Compounding this issue is the fact that just 5.7% of advisers in the UK are under 30, according to data from the Financial Conduct Authority. Firms must address this and focus on attracting the next generation of financial planners, while retaining the knowledge of experienced staff.
Addressing this multifaceted challenge requires a strategic approach to Diversity, Equity, and Inclusion (DE&I), with a specific focus on age diversity, and to ensure success, flexible working arrangements need to be at the centre of any DE&I initiatives. This approach can serve as a catalyst for change and offer a unique opportunity to attract a broader range of talent.
Why flexible working is gaining traction.
A survey from Indeed’s Better Work 2023 report[ii] reveals that two-thirds of British workers are willing to take a pay cut for a job that offers greater flexibility and reduced work hours. A third of respondents (33 percent) also said that flexible working is the future of ‘better work’.
Increasing flexibility in the workplace can benefit employees of all ages and at various career stages, allowing them to balance work commitments with personal life, including childcare or caring for elderly parents.
From a geographical point of view, it can also help firms to bring in more diverse talent, expanding the reach of the business and play a crucial role in retaining women who may leave the workforce when starting a family, as well as retaining older workers who wish to slow down but not retire.
These professionals can still contribute significantly to succession planning and business development and at the same time act as mentors for the younger generation in the firm.
Options for flexible working
Flexible working comes in all guises from remote and hybrid working to part time working, flexitime and compressed hours. Different options will suit different workplaces, but one that can be good for attracting younger people is compressed hours as it can enable employees with young families, to work longer days and have a day off periodically.
We found that a nine-day fortnight, with employees taking every second Friday off, works well in terms of providing the right balance of flexibility and support for employee mental well-being. It allows both men and women to participate in childcare responsibilities and provides those without families with a better work-life balance.
Another innovative flexible working arrangement is term-time contracts, allowing employees to take extended breaks during the summer holidays. While it can pose challenges for HR due to potential staffing shortages during peak business periods, it has proved to be a beneficial arrangement in terms of operational efficiency for many firms.
Embracing hybrid working also works well as it encourages employees, both young and old, to spend time in the office a few days a week while working remotely on other days.
Sabbaticals – a growing trend in flexible leave
Sabbaticals are another form of flexible leave that is on the rise. It’s not just older workers that can find these attractive, younger ones can too. For older workers after decades of service, it can give them the chance to recharge or have new experiences, allowing both personal and professional growth.
We have a senior employee who came back after sabbatical to a reduced-hours role as mentor and ambassador for the firm, for example. Equally, we’ve had an employee who took six months off to share childcare with his wife after their first baby.
Adapting roles to retain experienced staff.
Flexible working is a great tool for getting the most out of people at all stages in their career. For instance, it enables firms to transition older workers into different roles that align with the company’s evolving needs. At Punter Southall we created a business development role for a senior employee, enabling them to work compressed hours.
This worked for our employee as it gave them a fresh challenge, and days off. For the business we were able to tap into their expertise to attract new clients and mentor younger team members. Keeping this knowledge within the firm and transferring it to the next generation of financial planners is vital.
When it comes to training and development flexible working can also enable younger employees to work towards their professional qualifications, as well as give older workers the time to retrain and acquire new skills. Opportunities for learning, growth and skills development are essential for attracting and retaining every generation no matter their age.
As the workforce landscape evolves, putting flexible working at the centre of DE&I initiatives ensures business success, talent retention, and attraction of younger professionals. Flexibility is not just a perk but a cultural cornerstone that fosters a clear career path and ensures a diverse, inclusive, and thriving workplace.
[i]Many people would take a pay cut for more flexible working and shorter hours – Workplace Insight
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