We’re in the throes of the first quarter of 2022 and many of us are all excited to see what is in store for the financial services industry this year. Despite the challenges linked to the coronavirus pandemic, 2021 was still a relatively positive year with many firms quickly bouncing back and looking to take advantage of the economic climate.
However, we predict that 2022 will be a year of significant growth for Financial Services, with a lot of great things ahead and many positive changes to look forward to.
Growth in business and M&A
Last year was a big year for mergers and acquisitions; we see no reason for M&A deals to slow in 2022, in fact, they are accelerating. Advisors need to be ready to manage an increasing workload whilst delivering an excellent level of service.
To ensure efficiency and help manage workloads, the use of technology and software such as virtual data rooms, project management and pipeline management software will become much more commonplace.
Private Equity backers will continue to look for firms they can work with. Financial planning will remain an appealing area for many PE firms and larger practices looking to grow, with recurring fees and projected growth of the marketplace.
The M&A landscape isn’t just changing for Financial Advisors, but for companies looking to exit or acquire too. Business owners and directors looking to sell or grow will need to think about their succession plan and get the foundations in place.
Firms in growth mode need to have a solid recruitment strategy in place, else they risk failure, as candidates seek alternative ways to find work rather than applying via adverts.
Flexible working is here to stay
Before the pandemic changed the world, working from home and flexible working were rarely offered by companies. However, as people have adapted and embraced the ‘new normal’, flexible working has become a requirement for individuals who are looking for new roles - with work/life balance, reduced costs and increased productivity all attainable.
It is important to note that flexible and remote working also benefits the organisations offering these perks, as it builds employee trust, improves efficiency, productivity and more, decreasing costs and increasing overall profitability for companies. Additionally, companies can widen the talent pool (helping to overcome the skills shortage) and hire talent across the country without the limits of a commute. This has increased competition for the best people and is driving up regional salaries throughout the UK, making it more important than ever to ensure you have a good employee benefits proposition to retain and attract the best people.
Demand for financial advice will increase
The demand for financial advice has seen significant increases in the last few years and we don’t expect this to slow down anytime soon. Business owners are faced with uncertain markets and need to continually review and assess revenue streams and outgoings against the landscape of COVID-19.
When you combine this demand with the fact that six out of 10 financial advisors are looking to retire in the next five years, we predict that there will be a significant demand for financial advisors and other roles in the industry. However, financial advisors will opt for roles where there is an existing client bank to take over, so they can hit the ground running.
Financial Services will still experience a war on talent, as technology evolves and people choose to retire, leaving a significant skills gap. This will impact roles such as Paraplanners and Trainee Advisors, who will continue to be highly sought after and hard to find.
Make your next move in Financial Services with IDEX
2022 will be a big year for Financial Services. Find your next role in Financial Services or speak to us about how we can help you achieve your firms growth plans through our advanced, innovative solutions.
For more insights on what’s in store for the Financial Services industry this year, take a look at our 2022 Salary Guides.