Few industries have escaped the talent struggle in today’s job market. Over half of insurance companies report having more difficulties hiring currently, making this arguably their most difficult hiring era ever. Notwithstanding improvements, organizations still struggle with a lack of diversity; according to Deloitte, less than 25% of entry-level positions and only 8% of senior and executive positions are filled by people of different races and ethnicities. Due to the current state of the labor market, insurance companies must reconsider their hiring practices with diversity, equity, and inclusion (DEI) at the forefront of their considerations.
Why is it so difficult to hire in the insurance industry?
According to Brad Whatley, managing director of The Jacobson Group, the insurance sector has one of the oldest workforces in the business. This makes it challenging to engage young people in the workforce and excite them about insurance. Also, the epidemic made it more difficult for insurance companies to plan forward with their recruiting. Claims were much lower in 2020 and the first few months of 2021, which resulted in a lower requirement for personnel. Nevertheless, since then, activity has surged and numerous businesses are frantically trying to fill vacant positions. Understandably, with a dearth of individuals to complete the required responsibilities, this has increased competition on the labor market. Currently, the unemployment rate in the insurance sector is 1.6%, while it is 3.6% across all other industries.
Companies are struggling to fill the countless unfilled positions in the insurance sector. (a trend that looks likely to continue). Also, as insurance companies seek to employ a more diverse staff, the market’s supply of diverse talent is quickly scooped up.
Better recruitment tactics are required for the future.
The insurance sector is still expanding and has been for the past ten years, notwithstanding the brief slowdown while the pandemic affected the American economy. About two-thirds—68%—of companies in the sector aim to hire more people in the upcoming 12 months, according to a report released in August 2022, with predicted activity growth serving as the primary justification. Notwithstanding how fiercely competitive the labor market is currently, this planned hiring is still going on.
The anticipated 400,000 insurance workers who are slated to retire will also highlight the need for a robust recruitment plan in the near future due to the generational gap in the business. It won’t be simple to replace those departing employees either, as eight out of ten Millennials, according to a survey by The Institutes, know little about job opportunities in the insurance industry. For insurance companies seeking to maintain a sufficient workforce, all indications point to a challenging road ahead.
Insurance companies can compete better and attract and keep the talent that will support their growth if they consciously and strategically retool their recruitment technique.
You can devise a successful recruitment plan.
1. Introduce training and apprenticeship programs. Hiring to fill positions is far more expensive than promoting from within. Workers who have been with a company for a while, especially if they began as an intern, are more likely to continue with that organization. A dependable talent pipeline consisting of people invested in the success of that organization will result from internship and apprenticeship programs that assist develop the next generation of leaders for that organization. Some programs, like Zurich’s two-year apprenticeship, which pays apprentices’ tuition to finish an associate’s or bachelor’s degree and ensures job placement following the program, can also aid in attracting diverse talent.
2. Show a growth trend and assurance of employment. There is a bigger incentive for workers to remain in their employment given the current economic uncertainties and the recent wave of tech layoffs. It’s crucial for businesses to discuss career paths, find out what motivates the newest generation of workers, and put that at the forefront of their recruiting efforts. As the entire purpose of insurance is to reduce risk, it is crucial to emphasize the industry’s stability.
3. Make investments in diversity programs. Diversity must be protected and integrated into all of these hiring processes. Again, internship and apprenticeship programs can be helpful. According to Brookings, these initiatives have demonstrated potential in promoting innovation, reducing costs, filling positions that are difficult to fill, and developing a more diverse workforce. Just take a look at the excellent work Allstate is doing to promote diversity, break down barriers, and build a new talent pipeline for the asset management sector.
4.A rising tide lifts all boats, therefore it makes sense for insurance companies to band together to attract more individuals to the sector. In order to make it simpler for people to pursue a career in insurance, organizations like the Insurance Careers Movement are putting on conferences and fostering relationships throughout the sector.
5. Make use of data and technology to gauge recruitment success. To monitor the success of your strategic hiring strategies, it is crucial to implement the most recent management and recruitment technology. To keep improving your efforts and win executive support for these crucial recruitment strategies, you’ll need a clear mechanism to track the results.
For the expanding insurance sector, which is currently estimated to be worth $1.4 trillion in the United States alone, a more systematic approach to hiring and developing personnel is required. The good news is that insurance companies are in an excellent position to entice candidates with a convincing narrative of employment stability and that they have the resources needed to restructure their hiring procedures.