Report: Insurance Industry Faces 'Talent Crisis' | WGLT

Report: Insurance Industry Faces 'Talent Crisis'

Jan 15, 2019

A new report says that insurance companies will have to be more proactive—and pay more—to find and retain employees amid a “talent crisis” for the industry.

Low unemployment and more retirements have combined to create a highly competitive recruiting climate in the insurance industry, according to the Chicago-based Jacobson Group’s 2019 Talent Trends Guide. Companies should be ready to pay more and hire quickly to avoid losing quality candidates to competitors, the report says. They should also consider non-traditional candidates or those who can’t relocate but are willing to work remotely, the report says.

"Companies need to be transparent about what they're doing and engaging employees on a regular basis about the reasons, needs, and impact of change."

The report calls it a “talent crisis,” and that’s not hyperbole, said Greg Jacobson, co-CEO of the Jacobson Group and an Illinois State University alum.

“There are insurance companies around the U.S. that are not able to meet the needs of their shareholders or meet their growth or profitability goals because they don’t have the talent in place to execute on their plans,” Jacobson said on GLT’s Sound Ideas.

Bloomington-Normal’s economy runs largely on the insurance industry, with State Farm (around 15,000) and COUNTRY Financial (2,000) the No. 1 and No. 3 biggest employers.

Insurance industry wages have remained relatively unchanged despite decreasing unemployment rates and the resulting candidate’s market, the Jacobson report says. Average hourly earnings only increased by 22 cents for the industry from 2017 to 2018, lower than the general economy’s 82 cents.

“Only insurers willing to offer enticing salaries have a chance to stay ahead of the talent crisis and outperform the competition,” the report says. 

Large-scale company reorganizations or modernization projects can also make it harder to retain talent, Jacobson said. State Farm spent much of 2018 on a major reorganization that led to job cuts, relocations, and other changes. Big moves can change the culture of a company, rattling employees who expected to spend their entire career with the same employer.

There was a reason for that: Insurance companies historically have seen less turnover than other industries. But turnover is on the rise. 

“The impact can be that people start to realize they have to look out for themselves instead of having the company look out for them. They start to consider other opportunities,” Jacobson said.

To mitigate this culture shock, insurers should support internal mobility programs to help employees transition to new roles. Insurers can also “sponsor employee participation in technology and analytics events to empower employees to exert leadership, network and apply expertise within their organizations,” according to the Jacobson report.

“Companies need to be transparent about what they’re doing and engaging employees on a regular basis about the reasons, needs, and impact of change,” Jacobson told GLT.

You can also listen to the full interview:

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