4 Strategies to Address Talent Shortages in Wealth Management

According to KPMG’s latest Asset Management CEO Outlook, 89% of asset management CEOs plan to expand their workforce over the next three years, despite concerns about a shortage of skilled workers. This talent gap is amplified by the retirement of older employees, which creates a pressing need for younger talent to step into leadership roles. In fact, 33% of CEOs identified the dual challenge of retiring employees and a lack of suitable replacements as one of the most significant factors affecting their company’s growth prospects. 

This challenge is further complicated by shifting expectations in the workplace, as firms struggle to reconcile older employees’ work habits with those of the next generation. With 70% of CEOs mandating a full-time return to the office, firms risk alienating younger talent who often seek more flexible working arrangements. 

Succession Planning: Preparing for Leadership Transitions and Identifying High-Potential Talent 

As the industry grapples with its retiring workforce, succession planning becomes an even more critical strategy for mitigating risk and ensuring business continuity. By identifying high-potential employees early and preparing them to step into leadership roles, firms can help offset the impact of retiring senior staff and secure their long-term growth. 

Effective succession planning goes beyond simply naming a replacement; it involves proactive talent mapping to identify the skills and competencies needed for future leadership. Firms should focus on transferring knowledge from experienced employees to the next generation, enabling them to take on key responsibilities as seasoned professionals retire. This can help address the widening expectation gap between older employees and younger workers, which 26% of CEOs identified as a major challenge. 

Talent Mapping: A Strategic Approach to Workforce Planning 

An essential component of successful succession planning is talent mapping, which involves assessing the skills, experiences, and potential of current employees to ensure that future needs are met. By mapping out the capabilities of their workforce, firms can proactively address talent shortages and identify areas for upskilling or reskilling. 

Fuse Recruitment can assist business like yours with talent mapping to create a clear view of your workforce’s strengths and gaps. This process helps companies identify not only potential successors but also opportunities to develop employees’ skills, ensuring they are ready to meet the challenges of a rapidly evolving industry. With a tailored approach to workforce planning, firms can strategically prepare for future growth while minimising disruption. 

Embracing AI: Upskilling for the Future 

Despite concerns about AI leading to job reductions, KPMG’s survey found that few asset management CEOs believe it will significantly reduce headcount. Instead, many see AI as an opportunity to upskill their workforce and enhance existing processes. Three-quarters of CEOs have made AI implementation a top priority, with 84% expecting to see a return on investment within five years. 

AI offers a path to future readiness by improving data analytics, fraud detection, and cyberattack response capabilities. For businesses facing talent shortages, AI can help automate routine tasks, allowing employees to focus on higher-value activities that require specialised skills. Upskilling employees to work effectively alongside AI will be crucial, as firms look to fill roles that demand a blend of technical and industry-specific expertise. 

On another note, career development is the third top driver among job seekers in the banking & financial services, insurance & superannuation sector, as identified by SEEK. Advertising the opportunity for upskilling and potential career growth in job ads will help businesses attract top candidates. 

The Return to Office Challenge 

One of the obstacles in attracting and retaining talent is the expectation gap regarding workplace flexibility. While 70% of asset management CEOs insist on a full-time return to the office, younger employees often prioritise hybrid or remote work options. This is further backed by SEEK’s Laws of Attraction data lab which found that work-life balance and having the ability to work from home was a non-negotiable for many job seekers in this industry. 

Firms that remain rigid in their return-to-office policies may struggle to attract top talent, especially as competition for skilled workers intensifies. 

However, for those willing to come back to the office, there are rewards. CEOs have indicated a willingness to offer raises or promotions to employees who comply with in-office mandates. Companies need to strike a balance, offering incentives to motivate employees while considering the flexibility that younger workers value. 

Strategies for Navigating the Talent Shortage 

To address the talent shortage effectively, businesses need to adopt a multi-faceted approach that includes: 

1. Implementing Succession Planning and Talent Mapping 

By proactively planning for leadership transitions and mapping the skills within their workforce, firms can prepare for upcoming retirements and ensure they have the talent needed to sustain growth. 

1. Upskilling and Reskilling the Workforce 

Investing in training programs that equip employees with in-demand skills, particularly in areas like AI, can help firms adapt to evolving industry needs. 

1. Adapting Workplace Policies to Meet Employee Expectations 

While in-office work remains a priority for many CEOs, offering some flexibility can make a firm more attractive to younger talent. Hybrid models or other flexible arrangements could be the key to closing the talent gap. 

1. Partnering with Recruitment Experts for Talent Mapping 

Fuse Recruitment can help businesses develop a strategic workforce plan by providing expert guidance on talent mapping and succession planning. This enables companies to identify key talent, understand their workforce’s capabilities, and prepare for future challenges. 

1. Hiring Graduates to Strengthen the Talent Pipeline 

Bringing graduates into the wealth management industry is a powerful way to address talent shortages and prepare for the future. Graduates bring fresh perspectives, adaptability, and a strong foundation in emerging technologies and trends, making them valuable assets for firms looking to innovate and grow. Investing in graduate talent not only helps fill current gaps but also ensures a steady flow of future leaders who can drive long-term success. 

Explore Fuse Recruitment’s wealth management graduate talent pool here to connect with skilled and motivated graduates ready to make an impact in the industry. 

Ready to future-proof your talent strategy? Contact Fuse Recruitment today to learn how we can assist with talent mapping, succession planning, and workforce development. Let us help you secure the talent you need to drive growth and stay ahead in a competitive market.