Kevin Duffy Mortgage View
When pundits talk about the issues determining next year’s election, they are primarily talking about the economy and talking about the economy essentially means talking about jobs.
Unemployment continues to be the elephant in Gordon Brown’s living room but within the world of financial services there are finally signs that a slow thaw is occurring in what has been a two-year recruitment freeze. A recent report revealed that while over a third of businesses had not recruited over this period, the majority were now dusting off mountains of CVs.
In the mortgage industry, the national population of mortgage brokers has fallen by almost 60 per cent from 32,000 registered advisers three years ago to less than 14,000 today.
On one level, this is a harrowing statistic but when it is borne in mind that lending volumes have reduced by 70 per cent and product supply has reduced by over 80 per cent, it is testimony in some way to the resilience and tenacity of the sector.
Many advisers that have departed the scene would not be welcome back. Some were specialist-lending junkies who were parasites of the proliferation of sub-prime and amateur landlord product suites. Others have seen the downturn as reason to re-evaluate whether they were in the right profession in the first place.
Graduates are probably the most frustrated sector of the unemployed at the moment. I have trenchant views about the manner in which the education system has been manipulated over the last decade so that seemingly every student is now an A-grade individual. The consequences have been that a: many employers place a diluted emphasis on a candidate’s academic qualifications and b: graduates can carry an inflated opinion of their qualities and their desired remuneration.
This may sound like the rantings of Ebenezer Scrooge or Victor Meldrew but it is my opinion that many young people in interviews today behave as though they were candidates on a cross between the X Factor and The Apprentice. Interviews feature mindless soundbites such as “giving it 200 per cent” and my personal favourite “I am not here to make friends but to make the company money”. Pass the sick bucket.
Yet despite all this, when my daughter recently accepted that being a pop icon might be beyond her, she asked me what career she should follow. I was quick to promote that of a mortgage broker.
I can give at least five reasons why and how the intermediary sector is finally gaining some credibility and professionalism.
First, the downturn has killed off most of the delinquents. Second, the retail distribution review will hopefully bring higher professional qualifications and the MMR, possibly individualised registrations with the FSA. Third, banks have never been more mistrusted. Fourth, as referred to above, the attrition in practitioner numbers will create an environment within three years where the demand for impartial independent advice cannot be easily sated. And last, there are quite simply thousands of IFA businesses in the hands of fatigued practitioners looking for a way out.
Kevin Duffy is managing director of Mortgageforce