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The Insurance Industry’s “Talent Gap”

The Insurance Industry’s “Talent Gap”. Griffith Foundation Insurance Education & Career Summit Atlanta, GA September 25, 2011. Steven N. Weisbart, Ph.D., CLU, Senior Vice President & Chief Economist Insurance Information Institute  110 William Street  New York, NY 10038

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The Insurance Industry’s “Talent Gap”

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  1. The Insurance Industry’s“Talent Gap” Griffith Foundation Insurance Education & Career Summit Atlanta, GA September 25, 2011 Steven N. Weisbart, Ph.D., CLU, Senior Vice President & Chief Economist Insurance Information Institute  110 William Street  New York, NY 10038 Tel: 212.346.5540  Cell: 917.494.5945  stevenw@iii.org  www.iii.org

  2. The Industry Employs Younger Workers inProportion to their Numbersin the Labor Force 2

  3. Age Distribution: P-C Workersvs. the U.S. Labor Force, 2008 It appears that the workers at P-C personal lines carriers are, in general, younger than, and commercial lines employees and brokers are no older than, the U.S. workforce in general.Only reinsurance workers might be a little older Sources: McKinsey, Building a Talent Magnet, Exhibit 2; BLS; Insurance Information Institute 3 12/01/09 - 9pm eSlide – P6466 – The Financial Crisis and the Future of the P/C

  4. Does the P/C Insurance Industry Pay as Well as Other Employment? 5

  5. Average Hourly Earnings, Employees in Selected Financial Services, Mar 2006*–May 2011 From April 2007 through October 2009, average hourly earnings at P/C insurers were essentially flat at about $29. In the 21 months since then, average hourly earnings grew by roughly $3 (nearly 10%), but lost $1 in June and July 2011 *start of BLS series; not seasonally adjustedSource: http://data.bls.gov/PDQ/servlet/SurveyOutputServlet 6 12/01/09 - 9pm eSlide – P6466 – The Financial Crisis and the Future of the P/C

  6. Can We Attract New Hires to a Shrinking Industry? 7

  7. U.S. Employment in the DirectP/C Insurance Industry: 1990–2011* Thousands As of May 2011, P/C insurance industry employment was down by 33,600 or 6.8% to 457,500 since the recession began in Dec. 2007 (compared to overall US employment decline of 5.2%). *As of May 2011; Not seasonally adjusted; Does not including agents & brokers. Note: Recessions indicated by gray shaded columns. Sources: U.S. Bureau of Labor Statistics; National Bureau of Economic Research (recession dates); Insurance Information Institute. 8 12/01/09 - 9pm eSlide – P6466 – The Financial Crisis and the Future of the P/C

  8. U.S. Employment in the Reinsurance Industry: 1990–2011* Thousands As of May 2011, US employment in the reinsurance industry was up by 400 or 1.5% to 27,300 since the recession began in Dec. 2007 (compared to overall US employment decline of 5.2%). *As of May 2011; Not seasonally adjusted; Does not including agents & brokers. Note: Recessions indicated by gray shaded columns. Sources: U.S. Bureau of Labor Statistics; National Bureau of Economic Research (recession dates); Insurance Information Institute. 9 12/01/09 - 9pm eSlide – P6466 – The Financial Crisis and the Future of the P/C

  9. U.S. Employment in Insurance Claims Adjusting: 1990–2011* Thousands Katrina, Rita, Wilma From 1990 to 2008, the number of claims adjusters grew by an average of about 1.5% per year. Some of this slow growth may be due to use of new technology. Since October 2008, when employment peaked at 56,200, about 8,000 adjuster jobs were shed. Some of this may be due to strategies to pay small claims without adjustment. *As of June 2011; Not seasonally adjusted. Note: Recessions indicated by gray shaded columns. Sources: U.S. Bureau of Labor Statistics; National Bureau of Economic Research (recession dates); Insurance Information Institute. 10 12/01/09 - 9pm eSlide – P6466 – The Financial Crisis and the Future of the P/C

  10. Is the Recent Declinein the Number of Agents/Brokers Temporary or Permanent? Is it a Result of a Trendto Online Shopping for Insurance? 11

  11. U.S. Employment in Insurance Agencies & Brokerages: 1990–2011* Thousands As of May 2011, employment at insurance agencies and brokerages was down by 37,900 or 5.6% to 641,700 since the recession began in Dec. 2007 (compared to overall US employment decline of 5.2%). *As of May 2011; Not seasonally adjusted. Includes all types of insurance. Note: Recessions indicated by gray shaded columns. Sources: U.S. Bureau of Labor Statistics; National Bureau of Economic Research (recession dates); Insurance Information Institute. 12 12/01/09 - 9pm eSlide – P6466 – The Financial Crisis and the Future of the P/C

  12. Ideally, Where Do Young People Want to Work? 13

  13. Top 150 Organizations Where Young Professionals Want to Work Sources: Universum survey of 10.306 professionals with 1 to 8 years of experience, November 2010-January 2011, at http://online.wsj.com/public/resources/documents/st_COMPANIES0321_20110321.html eSlide – P6466 – The Financial Crisis and the Future of the P/C

  14. How Will We Know We’ve Closed the “Talent Gap”? By Attracting People from the Most Prestigious Universities? 15

  15. Top 10 Insurance Companies, CEO’s and College Information Note: Top companies as featured in Fortune 500. Source: Insurance Information Institute. eSlide – P6466 – The Financial Crisis and the Future of the P/C

  16. Insurance Information Institute Online: www.iii.org Thank you for your timeand your attention!

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