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4 facts about the insurance labor market

A recent labor study survey says that the insurance industry will see a 1.72% increase in employment during the next 12 months. (Photo: iStock)
A recent labor study survey says that the insurance industry will see a 1.72% increase in employment during the next 12 months. (Photo: iStock)

A recent labor study conducted in the first quarter of 2016 showed that 66% of insurance companies surveyed plan to increase staff this year, the highest anticipated rate in its seven-year history. 

The twice-yearly "U.S. Insurance Labor Market Study" conducted by the Chicago-based insurance staffing and recruiting company Jacobson Group and Cincinnati, Ohio-based insurance industry consultant Ward Group to look at hiring trends within the insurance industry, found that 80.4% of insurance companies expect an increase in revenue throughout the upcoming year, signifying the second-lowest level since the July 2012 survey.

Additionally, the Bureau of Labor Statistics reported a 2% unemployment rate for the insurance industry, continuing the trend of low industry unemployment. According to the study, insurance companies are still facing moderate difficulty in filling open roles across all disciplines. However, insurers are reporting that recruitment is slightly less difficult than it was a year ago.

“The staffing prediction was the highest anticipated rate in the seven-year history of our survey,” says Gregory P. Jacobson, co-chief executive officer of Jacobson. “It is clear that the insurance industry is focused on building staff, resulting in an increasingly competitive labor market.”

The study revealed four key findings: 

   12-month growth

Image from the "U.S. Insurance Labor Market Survey" by the Ward Group and Jacobson Group

1. Revenue growth expected.

80% of property and casualty insurance companies say they expect an increase in revenue growth, while 82% of life and health companies responded the same.

Both property and casualty and life and health companies said that the primary driver for expected revenue changes will be market share. Fifty percent of personal lines companies said they expect pricing to drive revenue changes. 

 technology

Image from the "U.S. Insurance Labor Market Survey" by the Ward Group and Jacobson Group 

2. Technology, claims and underwriting have the highest demand. 

Technology, claims and underwriting positions continue to be the most in demand and are expected to grow yet again during the next 12 months.

 

 

 recruiting difficulty

 

Image from the "U.S. Insurance Labor Market Survey" by the Ward Group and Jacobson Group 

3. Technology, actuarial and analytic positions are the most difficult to fill.

On a scale of 1 to 10, with 10 being most difficult, companies responded that positions are still moderately difficult to fill and recruiting is slightly less difficult in most disciplines than it was a year.

Technology, actuarial and analytic positions were reported to be the most difficult to fill, while underwriting-reinsurers and claims were cited as two of the least difficult. Product line was said to have a significant impact on the ease of filling positions.

 industry growth

Image from the "U.S. Insurance Labor Market Survey" by the Ward Group and Jacobson Group 

4. A 1.72% increase in industry employment expected over the next 12 months. 

If the industry follows through on its plans, a 1.72% increase in industry employment is expected during the next 12 months — creating new jobs.

The primary reason to increase staff during the next 12 months is the expectation of an increase in business volume. Fifty-seven percent of companies listed this as the primary reason to hire, followed by 54% who reported expansion of business/new markets as the reason. 

staffing expectations

Image from the "U.S. Insurance Labor Market Survey" by the Ward Group and Jacobson Group 

Additional findings from the survey: 

  • About 72% of balanced lines property and casualty companies expect a staff increase during the next 12 months, 11 points higher than commercial and personal lines companies, respectively. 
  • About 80% of the companies who plan to add staff during the next 12 months expect an increase in revenue. Almost 60% said it will be because of a change in market share. 
  • About 78% of small companies said they plan to increase staff in the next 12 months compared to medium- and large-size companies at 56%, respectively. 

  • Technology was named the most likely to increase staff for all-size companies. 

  • Large and medium-size companies cited analytics as the area next in line for expected increases while small companies said claims. 

  • Personal and commercial lines companies expect the greatest staff increases in technology over the next 12 months compared to balanced lines companies with claims. 

  • Life and health companies have the greatest need in sales and marketing.  

The survey also showed these trends between January 2015 and January 2016: 

  • The total industry grew 0.88% versus an anticipated rate of 1.48%.

  • The property and casualty industry shrank by 0.52% versus an anticipated growth of 1.66%.

  • The life and health industry grew 1.37% versus an anticipated rate of 1.22%.

Related: 4 trends that will shape the U.S. Property & Casualty market in 2016

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