Labor shortages are growing in the insurance sector

Insurance industry consultants say there are unfulfilled job figures in the business sector.

Another expert, Greg Jacobson, of the talent research company The Jacobson Group, said that people have been lacking talent for a long time, but it is getting worse now. He said the 10-year average unemployment rate in the insurance industry is higher than the current 2.5%.

“We are in danger of not having a lot of talent out there, but this is not something that is unusual for our company. Usually, we keep a level of 2-3%.”

The total number of insured carriers currently stands at about 1.56 million people, Jacobson said, down 85,000 from two years ago.

“This is not because insurance companies do not hire people. “They are trying to hire more people,” said Jacobson. “Companies can’t hire fast enough to replace workers who are leaving.”

A large survey of the financial sector showed a 10-year low in unemployment and a 10-year low in the number of people leaving. He said this is not surprising given reports in other labor groups of “Major Attrition.”

Retirees and people leaving the workforce have created more jobs, Jacobson said. According to a recent industry survey, 14% of insurance companies have reduced operations, but only 6% plan to do so. Jacobson said the disparity is also driving the number of retirements and exits from the industry.

Across the financial and insurance sector, there are 367,000 jobs, according to the US Bureau of Labor Statistics – 20% more than in 2019 before the pandemic.

Another problem with hiring companies like Bloomington-based State Farm is getting people to move.

“It makes certain jobs unfulfilled,” Jacobson said. “There are a lot of companies, because of the way these companies are structured like farm links and things like that, that are in small towns. It’s very difficult for people to move, even for a CEO search, to small towns. .”

The most difficult areas of insurance to fill out are: technical, accounting, bookkeeping, claims, and documentation. Almost all of the companies surveyed said the position is harder to fill now than a year ago. One exception is people who hold high positions.

“We’ve never been in this category at this level in terms of the challenges of filling positions in the industry. We’re at a peak right now,” Jacobson said.

Jeff Rieder, of AON support group The Ward Group, said this meant existing workers were being paid more, to avoid wage suppression and inequality.

“This is causing many companies to change the salary mid-year. Although many companies may have budgeted to increase only 3.5% to 4%, what is happening year after year, what is happening is about 5%. “said Rieder.

Ten years ago, the average interest rate in the insurance industry was around 8-9 %, voluntary and involuntary. Now, it’s in the 12-15% range where people retire or leave the job, mostly due to overcrowding, Rieder said.

Retirement has also had another effect – the level of knowledge and a slight decrease in the average age of the worker and the length of working time for the first time in the history of the study.

And although there are no hard numbers, the experts said that the labor market has increased reports of so-called “ghost gares.” Those are the people who accept a job and then disappear and reappear.

“I have anecdotal information, but there’s a lot. Yeah, it’s been a problem,” Jacobson said, adding that experienced workers looking for new jobs have no problem.

“Companies have to move quickly (to) find the right person because almost everyone who is actively looking or considering an opportunity has multiple offers,” Jacobson said, noting that there are many stories of workers getting $30,000 to $40,000 raises.

“I had a client earlier this week and what they’re saying is that people are offering 15-minute opportunities for interviews specifically for these and writing positions, and other issues that they’re offering for resumes to meet their needs,” Rieder said.

Jacobson cautioned against too much haste. He said it’s not just about putting money before people.

“This is selling an opportunity, selling a relationship, selling a culture,” Jacobson said. “And if you don’t take the time to develop a relationship with a potential employee, that’s when you will face these dangers,” he said.

A variety of operational issues, Rieder said, are beginning to affect insurance companies’ customers.

“Seeing some difficulties in the (needs for) support services. It is also interesting to see that the number of losses has increased significantly in the first half of the year,” he said.

There have been challenges in the passenger car market and catastrophic events, particularly in the Midwest that require a lot of support services and could help drive growth, Rieder said.

In an effort to compensate for the shortage of full-time workers, Jacobson and Rider said insurance companies are turning to temporary workers.

There are 35,000 temporary workers in the US carrier market, Jacobson said, and 96% of insurance companies said they plan to use temporary workers in the next 12 months.