Data was compiled from surveys of nearly 7,000 financial advisors affiliated with wirehouses, independent broker-dealers, regional broker-dealers, RIAs, dually-registered practices, bank broker-dealers and insurance broker-dealers.

Total advisor headcount has shrunk for a fifth consecutive year, declining by 1.9 per cent, according to Cerulli Associates' Advisor Metrics 2014: Optimizing Distribution Channel Resources report.

“Advisor headcount decreased again, declining 12 per cent from a high of over 325,000 advisors in 2008,” said Kenton Shirk, associate director at Cerulli. “The registered investment advisor (RIA) and dually registered channels are the only segments that have increased headcount over this time period.”

Shirk said the Boston, MA-based research firm anticipates that headcount growth in the RIA and dually-registered channels will “continue over the next five years.” He did note however that wirehouses “operate at the pinnacle of advisor productivity and remain the premier distribution partner for asset managers.”

The research overall is in line with previous findings suggesting that asset marketshare gains in the RIA and dually-registered channels have occurred at the expense of wirehouses and independent broker-dealers – a trend that appears set to continue.

Shirk has previously described it as “historical and expected,” citing factors including the flexibility and autonomy inherent in the independent channel. According to findings from a recent TD Ameritrade study, full-commission brokerage firms also still supply RIAs with the bulk of their new clients (53 per cent), albeit less so today than was the case in 2012 (57 per cent).

It is also worth noting, however, that while it has been observed for some time now that the independent channel is benefiting from advisor movement, it too is suffering as advisors exit the industry and retire. Moreover, the RIA channel cannot always rely on advisor transition to generate growth and thus it has been said that it must “prove its sustainability” by bringing in new advisors to the industry, raising issues around recruitment and talent management.

“There is no doubt we are beginning to see attrition of aging advisors across all channels, but it's unclear how well or at what rate they are being replaced by new, younger advisors or by a smaller group of mid-career transitioners,” James McLaughlin, founder and chief executive of J H McLaughlin & Co, told Family Wealth Report. “I see many enlightened efforts by firms to attract and retain staff with internal training and professional development programs.”

McLaughlin added: “I see a pronounced shift in interest and visibility of college-age students in wealth management; an 'industry' and term that did not exist 25 years ago when the primary role was as a 'broker' within what were largely partnerships. One correlated indicator is the rate of credentialization across various designations, principally the CFP and the rise of college-level degree programs in financial planning.”

Meanwhile, in a slightly different outlook, Aite Group last year said it expects wirehouses and fully disclosed broker-dealers to suffer less erosion of marketshare from 2014 through 2017. It projected lower growth among independent RIAs, discount/online broker-dealers and self-clearing broker-dealers due to heightened industry focus on boosting advisor productivity and streamlining fee-based advisory programs. The report also argued that emerging digital wealth managers, which offer online tools and advice to self-directed investors at a lower cost than full-service providers, will play an increasingly important role in the industry – another trend which has caught the industry's attention in recent months.

In another excerpt from Cerulli's Advisor Metrics 2014 report, the firm said more and more broker-dealers are rolling out platforms to attract RIAs and dually-registered advisors in an attempt to woo those who are “interested in independence.”