Edward Jones Aims To Add 1,000 Brokers

(Dow Jones) Financial services firm Edward Jones plans to add more than 1,000 brokers in the U.S. and Canada this year as it seeks to expand its presence in urban and coastal areas.

"We're shooting to grow at 9% or 10% this year," Price Woodward, a principal for financial advisor development, said in an interview, referring to broker headcount. That would mean adding net 1,068 new brokers in the U.S. and 95 in Canada.

Edward Jones started the year with 11,927 financial advisors in the U.S. and 688 in Canada, he said.

The growth projection is lower than the 12% growth the St. Louis firm has averaged over the past three decades, Woodward said, noting that fewer individuals choose to move into the brokerage business when markets are down.

Edward Jones has financial advisors in all 50 states and plans to continue hiring across the U.S. But the company sees its biggest growth opportunities on the East and West Coasts and in metropolitan areas such as Chicago, Dallas, Houston, Atlanta, Phoenix, Los Angeles, Toronto and Vancouver, Woodward said.

"Our goal is to put advisors where the investors are," he said.

The brokerage firm has 375 financial advisors in Chicago, Woodward said, and needs more than twice that number to have what he described as "a meaningful presence" there.

Unlike other national and regional broker-dealers, Edward Jones doesn't have large branch offices or encourage its brokers to work in teams. Instead, it has more than 11,100 offices in North America, each of which consists of two people: a financial advisor and an assistant.

"We let our financial advisors pick and choose where they want to live and have their branch," Woodward said.

Brokers are employees of the firms and those moving from other industries receive a salary while they train and build their businesses, along with commissions.

Eighty-five percent of the firm's hires are new to the industry, Woodward said, and just 15% of those are recent college graduates. Most are career changers whose average age is 36. Those with a sales background, those who have taken on challenges in their careers and those whose compensation has been tied performance tend to do well, Woodward said.

Financial advisors who move from another brokerage firm are guaranteed a minimum monthly pay, which varies based on their previous production levels, to help transition their business. Edward Jones doesn't offer upfront signing bonuses as the big Wall Street brokerages do, but both new and veteran brokers can earn bonuses.

About half of its new hires are referred to Edward Jones by existing employees, according to Woodward.

"We want people to come because they like our model," he said.

Edward Jones manages about $502 billion in U.S. client assets and $14 billion in Canada, he said.