Positive sentiment about the future of the advice industry has returned but the looming skills shortage must be addressed, David Thomson has said.
The director of policy and public affairs at the Chartered Institute of Insurance (CII) said the findings of the Personal Finance Society's annual skills survey were an "amber warning" for advisers.
He said advisers were positive about the future of the profession as many of the negative predictions about the impact of the Retail Distribution Review (RDR) were not as bad as had been predicted. He also said increased business through auto-enrolment and economic improvement had buoyed hope for the future.
However, the future of the profession is at risk from a skills shortage. He said small advice firms faced a massive challenge in terms of recruitment as hiring unqualified trainees is a huge business risk.
Tomson said: "The professional is made up of people who want to run their own businesses, that is a big problem for the future.
"Overall this is an under supplying market. Millions of people who will be auto-enrolled will be future potential clients. There will be a need for more advice.
"We need to start being smarter on how to create a conveyer belt of new talent."
He said graduate schemes would work well for larger firms but smaller firms faced greater business risk when taking on trainees.
"Many of the solutions have not yet been invented but we need to help young people understand what financial planning is and get better routes into the profession."
He said the body was working with the government to help advice firms get access to suitable apprenticeship funding and asked all firms to actively encourage young people into the job of advice.
Tomson also highlighted the need for better education, saying two-thirds of survey respondents said job applicants lacked sufficient skills in basis such as reading and writing.
"This is an amber warning. The future is quite bring but only if we have a clear pathway for new talent."
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