According to Adviser Ratings’ Adviser Musical Chairs Report- Quarter 3, 2025, Q3 saw the total number of advisers reach 15,447, a net increase of 196 professionals.
This is thanks to a continued influx of 184 new advisers entering the profession, and a slowdown in the number ceasing practicing, with 195 adviser departures the lowest since 2018.
That was just before the financial services royal commission decimated adviser numbers, with Adviser Ratings stating these shoots of recovery can be seen optimistically.
However, the report encouraged any optimism to be cautious, with an estimated 545 advisers at high risk of leaving the profession and a further 583 at medium to high risk.
“Beneath this headline figure, the quarter was defined by a palpable tension between this nascent recovery and a profound structural realignment,” the report stated.
“The underlying movements reveal an industry in deep transition, simultaneously consolidating into larger, privately-owned ‘super-licensees’ and fragmenting with the continued emergence of new boutique firms.”
This trend is evident in the lower number of adviser switches. During the quarter, 496 advisers “switched” licensees, continuing a continual downward trend. Adviser ratings emphasise this trend as a “sign of increasing structural consolidation across the advice sector.”
The report also highlighted that there was a small drop in the number of practices, decreasing from 5,944 to 5,934. This small decrease might seem like a contradiction to the rest of the overall growth evident in the report, however Adviser Ratings stated that this is more evidence of the trend toward growth through consolidation rather than organic expansion.
“At the same time, Privately Owned licensees continue to dominate, representing nearly 97 per cent of practices and continuing their long-term growth trend,” the report said.
“Diversified groups, particularly listed players such as Insignia, remain focused on retaining profitable, strategically aligned practices, refining rather than expanding their footprint.”
Summarising the overall themes present in this quarters movements is a tension between regulatory pressures driving some advisers away while improved industry economics helps bring some talent back in.
“The licensee landscape is polarising between a drive for scale and a desire for autonomy, creating distinct pathways for advice practices,” the report said, adding that the DBFO reforms also present a “dual narrative” of opportunity through reduced red-tape and challenge through new compliance obligations.
“This is all occurring within a cautious macroeconomic environment, where a steady cash rate, rising equities and asset prices and persistent inflation create operational challenges against a backdrop of an uptick in unemployment,” the report concluded.
“Yet, confidence within the financial services, particularly advice sector, remains remarkably high.”
