The J.D. Power 2016 U.S. Financial Advisor Satisfaction Study shows independent advisers are slightly more satisfied at work than their employee adviser counterparts.

The study measures satisfaction among both “employee advisers,” those who are employed directly by an investment services firm, and “independent advisers,” those who are affiliated with a broker/dealer but operate independently, based on seven key factors. These include client support; compensation; firm leadership; operational support; problem resolution; professional development support; and technology support.

Satisfaction is measured on a 1,000-point scale, J.D. Power researchers explain: “Overall satisfaction averages 722 among employee advisers, up 21 points from 701 in 2015, and 755 among independents, down 18 points from 773 last year.”

These figures represent fairly high levels of satisfaction among those working as both independent and employee advisers, researchers explain, but this does not mean the advisory industry at large is in a stable place. Advisers polled by J.D. Power cited firm leadership retirements, the growing consumer preference for robo-adviser models and the ongoing evolution of fee structures as “setting the stage for a major disruption in the market for financial advisory services.”

“No doubt, the wealth management industry is in the eye of the storm right now, and the implications are far-reaching for firms that have been rooted in the traditional financial advisory services business model,” adds Mike Foy, director of the wealth management practice at J.D. Power.

Financial advisers will “obviously still be a critical part of the future of the business,” he adds,  “however, key industry trends—such as the availability of low-cost robo-advice; the rise of so-called ‘validators’ who want to make more of their own financial decisions even while supported by an adviser; and the new fiduciary rules putting clients’ best interests ahead of an adviser’s own profit—together set the stage for fewer and different kinds of advisers and an increasingly exclusive focus on the high net worth segment where advisers can add the most value.”

NEXT: What’s at stake in industry change 

From an industry-wide perspective, J.D. Power finds nearly one-third (31%) of advisers are poised to retire in the next 10 years, including 3% who plan to retire imminently. At the same time, the number of employee advisers indicating they will likely go independent in the near future doubled from 6% in 2014 to 12% in 2016. “Another 12% of advisers say they are likely to join or start an independent registered investment adviser (RIA) practice in the next several years, up from 7%,” researchers explain.

The researchers go on to suggest “billions in losses are at stake” if advisory firms do not act now to prevent disorderly staff retirements or transitions to independence.

“At the current expected rate of attrition due to retirement and firm switching, a firm with 10,000 financial advisers may have more than half a billion dollars in annual revenue at risk during the next one to two years, highlighting the critical need to retain top producers and to effectively manage succession planning to transition assets to newer advisers,” J.D. Power finds. "Investment firms must figure out how to satisfy their advisers because the stakes are so high.”

The research further shows that, among employee advisers who are highly satisfied, only 1% say they “definitely will” or “probably will” leave their firm in the next several years, compared with 46% of dissatisfied employee advisers who say the same. “The same trend holds true for independent advisers, at 2% and 45%, respectively.”

“These changing dynamics in the advisory business create new challenges for firms to focus retention efforts on top producers; attract new talent with skills aligned with the direction the business is heading; and create or refine hybrid business models that incorporate more technology and self-service options into their offerings,” Foy concludes.

Additional findings and information are here.