By Linda Koco
The insurance industry needs more sales professionals, but most companies are having a very hard time finding great candidates with or without experience, according to a new study.
In fact, 80 percent of insurance employers surveyed told researchers that they are having difficulty finding qualified talent to fill many open positions, indicated GreatInsuranceJobs.com.
This is despite the fact that, in 2014, overall insurance employment reached a record of more than 2.5 million, according to government data. That’s up from a 10-year low of $2.22 million in 2011.
The GreatInsuranceJobs.com 2015 report draws on a telephone survey that it conducted of 78 insurance employers as well as on data from the U.S. Bureau of Labor Statistics (BLS). The researchers spoke with property/casualty companies, life and health companies, agents and brokers, third-party administrators and managing general agents.
The pressure point
Agents and brokers (all lines) increased by 33,100 jobs last year, according to Roger Lear, co-founder of GreatInsuranceJobs.com and author of the report. The life insurance sector added more than 9,000 jobs; health carriers, 26,400; and property/casualty, 6,900. There were other gainers too.
Yet insurance employers across the board are encountering a supply and demand problem.
The 78 surveyed companies indicated they will need to add 15,354 more jobs, in sales and other areas, during the last three quarters of 2015. In the life and health insurance sectors, all surveyed employers said they are hiring. But it’s tough going, finding qualified help.
Where producers are concerned, the researchers found that many of these jobs go unfilled “because many talented job seekers don’t even know the jobs exist.”
In addition, while many sales jobs pay a salary plus commission, companies with 100 percent commission jobs report they are “forced to interview repeatedly just to have a few work out,” Lear wrote, adding that this is “draining recruiting, training and development budgets.”
According to BLS data, insurance sales agents numbered 374,700 as of May 2014, and their median salary was $63,730.
Retirement and recruiting
Two of the factors that Lear said promise to make hiring difficult this year are both well known to insurance professionals. These are the approaching retirements of current industry workers and the limitations of recruiting budgets.
Retirement concerns. The average age of people employed in the insurance industry is 54 years, the report said. The “scary part” is that more than 1 million employees in the industry are ready to retire in the next 10 years. That’s equal to about 40 percent of the industry, the report indicated.
This comes at a time when insurance employers say they need to increase their workforce, so it’s creating pressure.
Employers are “very aware that the future hiring road is going to get rocky unless they seriously address the retirement issue facing the insurance industry,” Lear noted.
Recruiting budgets. During the recession, many companies cut spending on recruiting, Lear pointed out. The problem is that these budgets haven’t yet bounced back, despite the economic recovery. This is making it hard to attract and hire talent to keep up with the job requirements, he said.
A related issue is what the researchers called “salary regulations.” That is, many companies that recruit top talent “can’t offer enough money to potential hires due to the salary grades being regulated.”
Could social media help with recruiting? Apparently, that will be an issue for another day. According to Lear, “except for LinkedIn, insurance companies are slow to adapt a defined social media recruiting program as part of their overall recruiting strategy.”
Many surveyed companies told the researchers that they don’t have the time or resources to dedicate to social media recruitment efforts. And among those that do have the time and resources, LinkedIn is the primary social media used for that purpose, with many carriers using it like a traditional job board.
Low unemployment rate
The unemployment rate for the insurance industry is very close to pre-recession levels, Lear noted, pointing to BLS data. In January 2015, this rate was 2.3 percent. That’s down from the 10-year high of 6.2 percent in 2010.
“This is good news for job security, but makes a tight recruiting market that much tighter,” he said.
The number one priority for the industry right now is getting the message out that “the insurance industry is growing with really great jobs and career paths,” he said.
InsuranceNewsNet Editor-at-Large Linda Koco, MBA, specializes in life insurance, annuities and income planning. Linda can be reached at [email protected].
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