An Actuary friend of mine told me that he was given a career guide, he started at ‘A’ and stopped at Actuary as it offered him a car immediately on passing probation.
In fact, an urban myth is that all young people want, is to get on X Factor. A 2016 ONS study actually proves this as fact. At number one, over 11% of 16 to 21 year olds wanted to become a writer, actor or producer. Teaching and education came second at 9%. Pharmacist, dentist or vet came third. In contrast, almost 20% of them end up in teaching, retail, care work, nursing and administration occupations.
So should our youth be leaping forward expectantly into the world of pensions instead? This writer definitely thinks so and for a number of good reasons.
The pensions industry is here to stay. It looks after over £2 Trillion of assets, almost a third of total assets under management in the UK. Auto-enrolment legislation ensures that this will grow. We estimate that the DC market will have over £1 Trillion assets under management by 2025. These schemes need to be designed, administered and funds need investing.
Pensions is exciting. It involves robotic advice, derivative trading, currency hedging, longevity analysis and member guidance. However, even with all the automation in the world, the more staid roles we know and love will never go away. Additionally, even automation requires analysts, hardware engineers and software programmers.
Pensions is sticky. DB Pensions are notoriously complex. Even if they are bought-out or go into the PPF, they need actuaries, administrators, investment professionals and technology support. DC schemes can be straightforward to administer, but require far more automation and member web functionality to deliver value to members, meet the Regulators increasingly rigorous requirements and meet Freedom and Choice regulatory options. Auto Enrolment, CDC, Partial Transfers and Drawdown, all add additional complexity and this is bound to spiral out of control. Complexity needs training, knowledge and experience. This builds a premium for pensions professionals and creates stickiness within the industry.
Pensions gives career flexibility. We all know of stories where a pension administrator has grown to become Managing Director of a company. On the other hand, we all know a single parent who has found a semblance of work-life balance juggling a part-time career in pensions with domestic priorities. The industry is very forgiving and flexible, allowing individuals to find their own space.
Finally, pensions is a caring industry. We safeguard people’s savings, to ensure that they are looked after in retirement. Internally as well, we are a small industry where people know and look after one another. These are the two reasons why most of us have enjoyed our careers in pensions and are supportive of injecting fresh blood into the system. However, the industry elders do have a role to play in publicising career options in the world of pensions, the social value of the profession and all of the benefits of working in this industry. We also have a duty to look after the young people joining the industry. Ensuring they have the training, the tools and the space to build a career. In our rush to shareholder profit maximisation, we must not forget that our young pension professionals and Rising Stars are critical stakeholders within the equation. The future of pensions is theirs and we need to encourage them to join and stay within the industry.