The number of Financial Planning firms planning to recruit in the next 12 months has nearly doubled from 32% last year to 57% this year, according to a new report.

Recruitment is now higher on the agenda for Financial Planners after last year's pandemic-hit recruitment market. 

More than 6 in 10 (65%) Financial Planners say they are also working with more clients than last year, according to the Financial Advice Business Benchmarks 2021 report from The Personal Financial Society (PFS) and tech firm NextWealth.

The report was based on a survey of 278 PFS members between 14 July and 13 August.

The survey found that the average client portfolio size of Financial Planners rose over the past 12 months to £345,693 (2020: £305,175).

Sarah Lord, president of the PFS, said the number of Financial Planning firms looking to focus on recruitment demonstrated how positive firms are that demand is set to increase.

She said: “The demand for Financial Planning is only set to grow as the pandemic shone a light on how vital it is to have financial resilience to weather any storm that may come your way. It is hardly surprising to hear so many of our firms are looking to hire and recruit as they can know that the need for their services will grow in the years ahead.”

Last month Financial Planning firms told Financial Planning Today that they have had their growth plans held back due to struggles in finding the right Paraplanning, compliance, IT and legal staff to join their teams. 

Financial Planners surveyed were also making more use of technology in 2021. More than 6 in 10 (65%) of firms surveyed said they now use e-signatures, an increase from 53% in 2020.

Almost three-quarters (70%) of the Financial Planners surveyed said they were making use of a client portal, a rise from the 60% reported in 2020. More were also using digital advice offerings with 10% of Financial Planners offering or referring clients to a digital advice offering, double the 5% doing so in 2019.

Heather Hopkins, managing director of NextWealth, said: “After a year in which new client numbers and recruitment stalled, this year's Financial Advice Business Benchmark study shows almost two thirds of firms are working with more clients than in the previous year; well over half are planning to add headcount during the next 12 months, and gross revenue and average client portfolio value are both up on last year.

“While these are all strong indications of businesses bouncing back from a bruising year, the study also shows that advice firms are thinking strategically about building a future-focused client base, with efforts to attract younger clients, improve use of technology to streamline processes and bring younger planners into the practice.”