Say it quietly, but Asset Management may be turning a corner

I’ve been recruiting for the asset management sector for nearly 25 years. Throughout that time, the industry has been looked on with some envy by investment bankers. Not in the good times of course, when investment bankers were receiving mega bonuses, but post-financial crisis many sell-side professionals saw asset management as a more stable career. Fee based, less cyclical, and a better work/life balance. Then of course we had the post-pandemic boom, where everyone was getting huge pay rises across financial services and hiring boomed. Unfortunately, since 2022, the geopolitical plates moved and hangover from the COVID recovery kicked in. The industry that was supposed to be metronomic became cyclical, experiencing fee pressures, and teams are exhausted from working hard and seeing few positive results.
The team at Fram speak to asset management professionals daily, and I think the mood over the last 18 months has been the most negative I can remember. More worryingly, some industry veterans I’ve spoken to think this has been the worst time for asset managers they can remember. Soaring staff costs, outflows, weak markets, regulation, and an industry struggling for direction. It’s very clear to us that the key priorities for management are reviewing distribution, reviewing products, and data. Essentially, understanding how to get the right product to the right people – and hence why data transparency is so important. I don’t subscribe to the view that UK equities are doomed. If they get too cheap, someone will see value and buy them, but it is important that firms see the UK as a great place to be listed. As firms work through their issues, and will no doubt emerge from this mini-crisis far stronger in my view, there has been some strategic hiring. However, hiring volumes are down significantly and there is some great talent on the sidelines. Smaller firms often pivot faster than larger firms and have fewer legacy issues, but larger firms have more resources for introspection and change. It will be interesting to see if there’s a trend on who recovers quicker in the next upturn.
Share prices of listed asset managers have really suffered. However, reading through various recent trading updates, there does seem to be some better signs. Firstly, hats off to Premier Miton who have seen AuM increase. Fixed income has performed well, and whilst UK equities still seem to be a challenge, they have seen net positive flows across their fixed income and equity funds during the quarter. Their newly launched MPS for intermediary clients seems to have been well received. Liontrust has seen its outflows slow, and they too have increased their investment and distribution capability.
There has no doubt been huge amounts of work taking place behind the scenes at many asset managers, which should place those who’ve taken action well for any recovery. We also feel this bodes well for the employment prospects of those in the industry. If flows improve as expected as rates falls, the battle for sales & marketing talent could be pretty fierce as firms look to capture market share. Some firms have hoarded staff, whereas others have been running very lean teams for some time now. Attracting and retaining talent will be key and firms will start to position themselves for recovery before it becomes obvious to their peers. Therefore, being proactive in creating a strong employee value proposition, ensuring that the building blocks are in place soon is important.
I look forward to the market normalising after a rollercoaster few years, and to seeing some of the very good people who are out of work back in the market.
About Fram Search
Established in 2010, Fram Search is a specialist financial services recruitment consultancy. We focus on mid-to-senior hires in the UK and internationally.
We provide high quality contingent and retained recruitment services to boutiques and global brands. We have long established relationships, outstanding market knowledge, and access to deep talent pools. Fram takes a highly consultative approach, combining outstanding tech with a human approach. We are proud that our contingent fill rate is nearly three times the industry average and we augment our retained search methodology with rigorous psychometric testing. We take ESG seriously, we are champions of diversity and all staff have undertaken unconscious bias training. We also carbon offset.
Please contact us on 01525 864 372 / [email protected] to learn more.
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