Where are all the stockbroker trainees headed? It appears many are headed straight to Edward Jones.
Large brokerages are having a tough time, to say the least. In fact, the Wall Street brokerage business environment has changed dramatically in the last few years, as many brokers are leaving larger firms in lieu of positions at money management businesses that don’t charge commissions on trades. In addition, discount brokerage firms have lured business away from some of the larger firms, including Morgan Stanley, Merrill Lynch, and Wells Fargo.
Bucking the Trend with Increased Hiring of Brokers and Advisors
However, Edward Jones continues to buck the trend of the struggling brokerage. In fact, in 2012 alone, Edward Jones hired nearly 2,700 trainees, with plans of hiring the same in the upcoming year. Edward Jones currently has about 12,000 advisors.
Trainees for Edward Jones don’t, however, spend their time chained to a desk or fetching coffee; instead, they must serve as salesmen, actually going from door to door, pitching products to individuals in person, and counseling them on ways to meet their financial goals.
The “New” Old Way to Train Brokers and Advisors
Training at Edward Jones begins when trainees arrive at headquarters and train in rooms called “role-play suites.” After training at company headquarters is complete, new trainees head to their home towns, armed with a list of potential clients. The starting salary is about $30,000, and the days can be long and tiring.
Although this type of training is not the ideal situation for all trainees, this program has been a success for Edward Jones, who has managed to keep its sales force the same size since 2007. Revenue for Jones Financial increased to a record $5 billion in 2012 and has increased 42 percent since 2009, far outpacing the next in line: Merrill Lynch at 10 percent during the same period.
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