Morgan Stanley, which has been struggling to increase the size and productivity of its broker force, plans to eliminate about 10% of its brokers.

In a memo to retail brokerage employees yesterday, the company said it will slash about 1,000 of its lowest-producing brokers from its force of about 10,000 over the next few months. It also said it is slowing down its training program for new brokers, focusing instead on recruiting “experienced brokers who are focused on serving high-net-worth individuals.”

“They are going to war here,” an analyst at Punk Ziegel & Company, Richard Bove, said. “They are shifting money out of their training program and into recruiting from other firms that have been raiding them constantly for the past year and a half.”

Plans for reorganizing the retail brokerage unit, which Morgan Stanley inherited when it merged with Dean Witter Discover in 1997, were started earlier this year, before new Chief Executive John Mack was brought in to replace Philip Purcell. As part of that reorganization, retail brokerage head John Schaefer, a longtime ally of Mr. Purcell’s, said earlier this month he will be leaving the firm by the end of the year.

“We are moving forward with an internal and external search” to replace Mr. Schaefer, the acting president, Zoe Cruz, wrote in the July 28 memo. “The process of identifying the best candidate and getting that individual in the job could last into next year.”

A 23-year veteran of the Dean Witter brokerage group, Ray Harris, will become acting president and chief operating officer until a permanent replacement is found for Mr. Schaefer, she wrote. Mr. Harris, a managing director, is currently head of client solutions for the unit, known internally as the Individual Investor Group.

Morgan Stanley has hired recruiting firm Heidrick & Struggles to find a permanent replacement for Mr. Schaefer, said an executive at the search firm.

The memo outlined several shifts in strategy for the flagging retail group, which in some recent quarters had profit margins that were five or more percentage points below the company’s goal of 15%. Mr. Schaefer had instructed branch managers earlier this year to step up recruiting and training in an effort to close the gap between the firm’s approximately 10,200 brokers and competitors such as Merrill Lynch (with 14,200 brokers) and Citigroup Smith Barney (with more than 12,000).

The managers were having trouble attracting candidates, people at the firm said, and the problems may have been exacerbated by almost daily headlines throughout the spring about a management and profitability crisis at the big investment bank. Morgan Stanley’s brokers also on average bring in lower revenue, about $470,000 a year, than do those at Merrill (about $710,000) and Smith Barney ($538,000).

Morgan Stanley anticipates reducing its broker force by about 10%, according to the memo.

“We must constantly review the performance of individuals in the retail group and identify those who are not up to our standards,” Ms. Cruz wrote.

Wealthy individuals are “the most profitable segment of the business, and will be a key target for growth and investment,” she said.