The bear market, a bust for most plan sponsors and money managers, has been a boon to investment consultants.
Despite the fact that search activity has been down the past few years, investment consultants are more in demand now than at any time during the 1990s bull market.
The number of plan sponsors using consultants jumped 20% in 2002 to 79%, according to Mercer Investment Consulting Inc.'s Tracker database.
"This is an environment where plan sponsors feel less confident about operating independently," said Robert Burke, practice leader at Mercer in New York.
"There's no question that the demand for consultants has ratcheted up," said Louis Harvey, president of Dalbar Inc., a Boston-based research firm that follows the consulting industry. "Consulting firms are seeing more business than ever."
Consultants agree. "This is a great time to be in the consulting business," said John Dickson, chief executive officer of CRA RogersCasey, Darien, Conn. "Challenging markets create opportunities for consultants," said Mr. Dickson, and the demand for consultants is as strong as it has been in years, he added.