Future of Financial Advisory and Career Transitions

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This is the part of the show where we answer questions about business, big tech entrepreneurship, and whatever else is on your mind. If you'd like to submit a question for next time you can send a voice recording to officehours at property media dot com. Again that's office hours at property media dot com or post your question on the Sky Galloway subreddit and we just might feature it in our next episode. First question. Our first question comes from Jonah Klein on LinkedIn. Jonah says, It seems clear to me that a big part of the reason for the dearth of entry and junior level positions has to do with AI taking over much of the corporate grunt work that used to comprise much of what entry level roles did. At some point corporations are going to have to figure out who will be their future leaders if they aren't hiring entry level talent. What do you make of this? And what do you think entry level roles will look like for recent college grads in an AI driven corporate envir on So new graduates now account for just seven percent of new hires of big tech. That's down from twenty-five percent in twenty twenty three and over fifty percent pre-pandemic, according to Forbes. So big tech has dramatically reduced new hires. Early evidence suggests hiring for junior workers is already declining in AI exposed fields. A Stanford study found entry-level employment in AI-exposed occupations fell about 13 percent relative to less exposed jobs since generative AI adoption started to take off. The decline is concentrated among workers aged twenty-two to twenty-five, while employment for more experienced workers in the same occupation remains stable or grew. The problem, as you referenced, AI is uh most capable of automating the tasks traditionally assigned to junior employees. Some research here on large corporations uh models suggest around eighty percent of the workforce could have at least ten percent of tasks affected by AI with knowledge work tasks, including writing, coding, and analysis especially exposed. Howe ver, you know, really the labor the labor market does not just reflect the the you know, job apocalypse that it was supposedly uh w we we're worried was gonna happen. There just hasn't it's not easy to really find large scale job licenses from AI. What I think you see is AI paralysis, kind of no hire, no fire. What's interesting, the most interesting thing about the labor market right now is one of the I forget what the term is, but people looking for another job is at an all-time low. People are thinking, oh, maybe I'll just stick here. Employment remains relatively resilient, suggesting AI is currently changing how work is done, more than the total number of jobs, though hiring appears to be slowing. So people are asking you to be more productive with AI and saying we're not going to hire as many people next year, but they're not laying off people yet. Research suggests the first running of the corporate ladder may shift or I should actually I should condition that. There is some layoffs. There are some layoffs in big tech. They're the early adopters of AI. I think a lot of that is overhiring from the pandemic. But when you lay off people, there's sort of a false flag going on around layoffs right now. If you lay off people, it's not because our business is slowed down or I'm a fucking idiot and overhired during pandemic. It's OAI, right? We're we're leveraging new technology because I'm so smart and my stock will go up if I say we're gonna be more productive because I can reduce ten percent of the workforce and not lose any productivity because I know how to master AI as opposed to saying we overhired or you know, or business is not we're projecting business is not going to be that strong. So a lot of people are blaming AI and it may not actually be accurate. So employment remains relatively resilient, suggesting AI currently changing how work is done more than the total number of jobs, as we said, although again, hiring does appear to be slowing. Research suggests the first rung of the corporate ladder may shift toward AI supervised analyst, uh juniors validating and interpreting AI outputs, uh, higher skill starting roles, fewer hires with more technical expectations, and skill-based hiring, greater emphasis on practical AI literacy rather than just degre es. So this all kind of leads to you know what you should do. First and foremost, buck up. When I graduated from business school in 2002, 199 2, 40% of us had jobs on graduation day, which meant the majority we're at commencement with our parents, you know, wearing the cap and gown. And the majority of us didn't have jobs. So this and uh quite frankly, the younger generation is just used to people three or four years ahead of them having three or four offers of JP Morgan and Google. Yeah, it's gotten a little bit tougher, but it's still not bad. Youth unemployment is about 10%, which is kind of historically an average, if you will, to be AI enabled. Any interview, you should be able to ans wer essentially three questions now or fourth. Uh, what's different about you? How does it apply that differentiation to being able to be good here? And how do you work on that differentiation? And then the fourth thing you need to ask is how do you think AI is going to impact this job? And specifically you have to demonstrate you have to demonstrate AI literacy as it relates to that job. If you want to be in brand management at Estee Lauder, you've got to be able to communicate. This is how I've been using different LLMs to think about product launches or new product development or how we make our your media budget at Estee Lauder more impactful. No one says that we're not going to hire that person. They seem to understand a lot about AI. No one ever says that. So you need to add that to your toolkit, if you will. Interview as many places as po as possible. Don't let perfect be the enemy of good. And recognize no one's coming to save you. You have to get a job. I mean, in what I will say that the economy is now where it has been for 99% of the world for 99% of history, and that is you have to go get a job. No one's coming for you. And also just recognize you could absolutely add value to a company and you're confident, but ask yourself before you go into the interview, what's different about me? Why does that differentiation matter to company like this? What do I do to work on and establish and maintain that differentiation? And also find a way to incorporate into your wrap how your AI literacy and AI domain expertise will impact your ability to add value to that organization. Thanks for the questi on. Question number two comes from N Williams, seven-thirty two on Reddit. They say, Hey Prof G, I'm curious if you're looking at the senior healthcare space from an investment perspective. The way I see it, we have a growing demographic of people over 65 with the majority of wealth in the U.S. and rising life expectancies. Would love to hear your thoughts on the validity of this thesis, potential impact on society, and if you think the space is positioned well for investment. Oh yeah. Disco. I I read a thing on which companies are like have the highest failure and highest success rate. Like clubs and restaurants have you know, like a 10% success rate. Um and the number one most successful business for like 94% was senior care. And this goes to one of my big themes that I tell my kids. You have ROI on the y-axis, you have sex appeal out, sexy businesses on the X axis. The line goes firmly and squarely down to the right as you go along the X axis. Sexier the business, lower the return on your financial and human capital. You want to own a restaurant, a jewelry line, a club, going to sports, entertainment, Hollywood, anything that sounds cool, you better mean the top ten, if not the top one percent right away, because there's an overabundance. Th'eres an overinvestment in human capital, meaning the returns are starched out. You want to start a SaaS company offering maintenance for healthcare workers that maintain um X-ray machines? Disco. That business is gonna show a great ROI. The top half of tax lawyers make really good livings. The top half of actors are unemployed. The senior space is really unattractive. We don't like to be around seniors, right? They're they're they smell funny. Or you go into a place at seniors home and you think this isn't this isn't where I want to hang out. And guess what? It's actually a very rewarding job. So anyways, uh senior centers, senior care, fucking amazing business. So the market Peter Jarker, who's one of my role models from a professional standpoint, said every major shift in the economy or successful businesses are basically driven by demographics. So the U.S. population of people 65 plus reached 61.2 million in 2024. The census projects one in five Americans will be over 65 by 2030. The fastest growing and most care-intensive group is the 85 plus population. People are living really I I read that the fastest growing cohort in America are people over the age of a hundred because there never used to be any of them and now there's gonna be a lot of them. Projected to grow from six point five million this is people over eighty-ivef in twenty twenty-two to thirteen point seven million by twenty forty. So in just in just eighteen years, the number of people over the age of eighty-five is going to dou ble. And that's from the U.S. Department of Health and Human Services. So another six and a half million people, if you're over eighty-five, you need care of some sort, either a live in or special services or someone dropping by or just specific niche services. So that industry is gonna dou ble uh over the next uh decade and a half. According to the Centers for Medicare and Medicaid Services, CMS, seniors account for a disproportionate share of health care spending. The average annual health care spending for someone aged over sixty five is about twenty-two thousand dollars per year. That's roughly two and a half times higher than working age adults. I bet it's more than that. But think about it, this market, double the number of people, and they spend $22,000 a year on healthcare. Medicare Medicare spending continues to expand with the aging population. Medicare spending reached about 1.1 trillion in 2024, growing seven to eight percent year over year. The financing layer around senior healthcare is also expanding. More seniors are getting their Medicare coverage through private insurance companies rather than this traditional government run Medicare program. Medicare Advantage enrolled uh reached about thirty-five million people in twenty twenty six, meaning more than half of eligible seniors are now in Medicare Advantage plans. The labor market reflects this. So the Bureau of Labor and Statistics projects that home health and personal care aid jobs will grow 17 percent through 2034, one of the fastest growing occupations in the U.S. So the demographic shift here is real. America is aging rapidly, and the most care intensive population is 85 plus. So the addressable market is set to double. By the way, growth is everyt hing. Yeah, when I go I was in Zermot and it was fresh snow and went out and I thought, Oh, I'm a pretty good skier. And then the snow got shitty and froze and I and then it reminded me, okay, no, I'm not. I'm a shitty skier. When you're in a growth market, it's fresh powder and you can just be very good without being very good. And that is, you'd rather be average in a growing market, then great in a declining market. Because the win, quite frankly, the winds are just in your sales. So a business servicing people over the age of 85 , disco, and I'm talking John Travolta disco, not like Casey and the Sunshine Band. Actually, I love Casey and the Sunshine Band. Uh anyways, if you want to start a business servicing people over the age of 85, champagne and cocaine, my brother. And the champagne is none of your friends are going to want to do it because they don't want to be around old people. So there's a lack of investment from human capital. You can raise money because uh private equity and venture capital firms smell money around this population. And God, I'd love to put together that deck. My adjustable market is about to double in the next 15 years. In sum, the big winners will likely be the companies that help the system care for older Americans, specifically eighty-five plus at lower costs and outside the hospital. Outside the hospital where costs are huge and quite frankly, the longer, uh, the more time you spend it. No one says, Oh, you know, I'd be more comfortable in the hospital. People don't want to be in the hospital. I do think that's gonna be I think there's gonna be I wrote a book called post corona, one of my big things was dispersion, dispersion of work to homes, dispersion of education to computers. Also, I think there's gonna be a huge dispersion of healthcare. I think the percentage of people who die at home, if you will, is gonna explode. Um when my mom was sick, I said, Okay, it sounds like we got about six months here, what's on your bucket list? And she said, I have two things. I wanna go see my family in England, we need to do that sooner rather than later 'cause I'm obviously not feeling very well. But she said more than anything, I just I wanna I wanna pass it home. And so this was nine this was two thousand and four. And quite frankly, it wasn't easy. Um, I had resources and I'm creative and I was able to take time off of a lead from NYU, so I was able to orchestrate it, but it's not easy. A lot. That's another one. 85 plus and helping people stay at home as as long possible. I think it's gonna be an enormous business. In some, it's a great fucking idea. It's a great idea. And lowest or highest success rate of any small business. Senior care. We'll be right back after a quick break. Support for today's show comes from Framer. Let's say your marketing team wants a new landing page, so the design team locks it up, and then your engineering department, who's already got too much on their plate, responds with, Yeah, we'll get to it. Thousands of businesses from early stage startups to Fortune 500s are choosing to build their sites in Framer, where changes take minutes instead of days to solve this very problem. Framer's enterprise grade no-code website builder used by teams at companies including Perplexity and Miro to move faster. 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That's grammarly. com support for the show comes from VCX, the public ticker for private tech. For generations, American companies have moved the world forward through their ingenuity and determination. And for generations, everyday Americans could be part of that journey through perhaps the greatest innovation of all, the U.S. stock market. It didn't matter whether you were a factory worker in Detroit or a farmer in Omaha. Anyone could own a piece of the great American companies. But now that's changed. Today our most innovative companies are staying private rather than going public. The result is that everyday Americans are excluded from investing and getting left further behind, while a select few reap all the benefits until now. Introducing VCX, a public ticker for private tech, VCX by FunRise, gives everyone the opportunity to invest in the next generation of innovation, including the companies leading the AI revolution, space exploration, defense tech, and more. Visit getvc.com for more info. That's getVCX.com. Carefully consider the investment material before investing, including objectives, discharges, and expenses. This and other information can be found in the funds prospectus at get vcx.com. This is a paid sponsors hip. Welcome back, question number three. Hi Scott, new listener here as a result of your most recent appearance on modern wisdom, and I'm a big fan of what I've heard so far. Congratulations on your success and keep up the good work. I recently left my consulting career at the beginning of this year to join my dad and uncle as a financial advisor on their team, but after about a year in the role, I'm second guessing my decisions and career choices in general. I realize I'm coming into a great situation joining my family's advisory team. However, I can't stop thinking about the long-term viability of being a financial advisor, given the development of AI, and how I think it will soon be able to perform the role of an advisor just as well as a human can, if it's not able to already. Additionally, I don't find the work engaging and am not a fan of working with clients. I'm thirty years old and not afraid to make career changes and start over, but do you have any advice for someone that feels like they're not accomplishing their potential When you're young, your benchmark is college and the kind of fantasy that work is amazing and fun that is uh or the myth that is told to you by people, your university and people. And so work is work. And what I would say is you need to give work at least one or two years to see if it gets bet ter. But if you really just are dreading work and you're there because you want to impress or you felt some pressure from your family. J haveust an open and honest conversation with your dad and your uncle and people you trust saying, I don't know if I like this, which makes me believe I'm not gonna be very good at it. And I'm wondering if I should consider something else. And also is there a different role within the company? In terms of I think you're trying to backfill it sounds to me, if I listen to your voice, you sound a bit down. And you're trying to backf ill um and I might be wrong here, but my sense is you're trying to backfill reasons for why you should leave. And AI's not one of them because financial advisors to a certain extent our tax code keeps getting more and more complicated. I'm spending more and more money on financial advice. Now do, I use my financial advisors at Goldman to come up with my stock picks and balance my portfolio? No, but I use them for tax planning, which has gotten incredibly, incredibly complicated. I use like folks at Northern Trust to find me mortgages, um, liquidity. I mean, the financial advisory services or wealth management at Goldman and JP Morgan are growing. And I think that my guess is the industry is growing because it keeps getting more complicated. Now AI will be able to say, okay, here's how you balance a portfolio, but financial services is oftentimes basically almost like senior care in terms of finances. And those people don't want to. They want you to understand AI. And they want you to give them a sense of security. And they want you to figure out the estate. Yeah, most of this stuff you can probably answer with AI, but they want someone to tell them and they want someone to make recommendations. And uh so I don' t you know the number of accountants, accounting is being destroyed by AI, but accountants are actually growing in number because they're moving upstream into wealth planning and tax strategies and inheritance. Inheritance and a lot of people I speak or you speak every year at the UBS young leaders thing, which is basically rich kids. You know, everyone, it's all these famous names, it's like, oh, your father started Bloomberg, and now you're a billionaire, and they bring him in for two days to talk about philanthropy and being a responsible citizen and how you manage money. There's gonna be a lot of succession planning. And quite frankly, people don't know how to do I I have no f I I am still confused around the relationship between my money and my kids and their happiness. Do I give them money? If so how much and when and how do I do it tax efficiently? And who do I need as a trustee and what are the tax implications? And you know, uh these are these are big issues that AI can kind of give you some ideas on, but people are still gonna want to meet with someone. So, anyways, bottom line is I don't buy AI is gonna destroy the industry, so you should get out. You gotta ask yourself, is this something I could be great at?