The talent shortage that is facing the financial industry is being solved, in part, by advisory firms and banks hiring contract, or gig, employees, according to a hiring firm executive.

With more advisors aging and retiring, and not enough new recruits taking their places, contract workers often can fill the gaps, said Seth Hildebrand, vice president for client solutions at PeopleCaddie, a technology based firm in Rosemont, Ill., that matches employers with suitable employees.

The need for more financial advisors and trained staff members is challenging the financial industry, which is trying to serve clients who are demanding increased levels of holistic services, Hildebrand said.

Others also have recognized the need.

“There are not enough people coming into this industry, and this is not a geographic problem—it is industrywide,” said Timothy Admire, president, CEO and managing partner at Willow Creek Wealth Management in Sebastopol, Calif., during a recent Schwab Advisor Services webinar.  The webinar was held for the release of the 2021 Independent Advisor Outlook Study that included 953 advisors.

Advisors are now being hired for full-time employment from a wider geographic area by more firms, which makes it easier to find the needed talent, according to nearly half of the advisors in the Schwab study. But 45% of the advisors said the process makes it more difficult to find the staff members who fit in with the culture of the firm or bank.

The number of personal financial advisors is projected to grow by 4% from 2019 to 2029, about as fast as the average for all occupations, according to the Federal Bureau of Labor Statistics. As the population ages and life expectancies rise, demand for financial planning services should increase, the bureau said.

If full-time employees cannot be found, gig employees can fill the bill, particularly if the firm is undertaking a well-defined project, said Hildebrand, who works with advisory firms and banks to fill those job slots.

Because the country and the world are only now coming out of the pandemic, which changed many work habits, it is too early to know how large the advisor shortage will be, he added, but there is liable to be a massive shortage in the technology end of the financial industry.

Clients are looking to access more financial services online and, at the same time, they want more holistic services. Advisory firms and banks will need to make that shift if they are to succeed, Hildebrand said.

“Financial service firms will have to meet their customers online. If a firm or bank is married to the old ways of doing business, those advisors are going to struggle,” he added.