The impact of regulation on the number of people in the industry remains a major source of interest for many people. It could stem from a need to know that there is safety in numbers, or a general concern that one may well, unlike Liverpool supporters, walk alone one of these days.
During a recent presentation on the RE results, some interesting figures emerged regarding the number of players in the industry. We provide a link to all the statistics at the bottom of this article. Our current focus is merely on the current numbers in the industry.
From July 2011 to 21 August 2013, the number of practices reduced by 1 714. One should be careful to read too much into this, as numbers fluctuate for a variety of reasons. Between 23 July and 19 August 2013, for instance, a total of 425 FSP licences were suspended, mainly on the grounds of not having paid their levies, or failing to submit their compliance reports. During the same period, the suspensions of 137 licences were lifted.
We have seen some amalgamation between FSPs, which means that not all those reflected in the reduced numbers actually abandoned ship.
There was a significant dip of nearly 17 000 in the number of representatives from July 2011 to July 2012, but this appears to have stabilised in the following year. A similar trend is noticeable in the number of “affected” reps – those obliged to write the REs by the 30/06/2012 deadline.
The total loss in Key Individuals over the last year comes to 1 131. The single biggest group impacted by this appears to be the sole proprietors, whose numbers dwindled by 439, or 17% of those in the industry, a year ago. The corresponding figures for key individuals show a reduction of 596, but “only” 5% due to the bigger base in 2012.
There is no doubt that the regulatory exams had a major influence in the demographics of the industry, and the end is not yet in sight. Many who received a reprieve from the deadline are still trying to pass the exam, but this is a far smaller number than what was initially feared.
The tragedy is that each person who leaves the industry takes with him or her something extremely important – experience. They leave behind a host of loyal clients who often become “orphans” who are now left to their own devices.
Which begs the catch 22 question: are clients better off now?
Please click here to download full statistics from FSB presentation.