Perspectives: Accelerating the industry’s drive for talent

The insurance sector seems to have experienced a slew of layoffs recently, but this industry, which is known for its stability in times of economic hardship, remains strong and is poised to grow as a positive contributor to society and the economy for years to come. To fuel this growth, however, we can’t take our foot off the gas when it comes to attracting the next generation of talent. 

Liberty Mutual Insurance Co., Farmers Insurance Group Inc., GEICO Corp., American Family Mutual Insurance Co. and others announced layoffs in recent months after employers in the industry and many other sectors engaged in a post-pandemic hiring frenzy. While the continuing hard market, higher interest rates, inflation and uncertainty surrounding natural catastrophes continue to pose economic challenges across the industry, they certainly don’t point to a need to slow recruiting efforts. In fact, the opposite is true.

The insurance industry continues to be a robust employer across the U.S. economy despite recent layoffs. According to the U.S. Bureau of Labor Statistics, 6.7 million people were employed in the insurance and finance industries as of October 2023. For the same month, 23,000, or 0.3%, of that workforce was let go. While layoffs are never positive news for employees, taken in context the data demonstrates the stability of our industry even in times of economic difficulties. By comparison, professional services, on a percentage basis, saw five times as many employees laid off at 1.6%, while construction saw six times as many at a rate of 1.9%. And remember, these numbers include financial services. The Insurance Information Institute put the number of professionals working in insurance in the U.S. at 2.9 million in 2022. When you add forecasts from the BLS cited by the U.S. Chamber of Commerce that over the next 15 years 50% of the insurance workforce will retire, our industry appears extraordinarily well-positioned for future job growth. 

So, how do we encourage and sustain that needed growth through recruiting? The answer is two-fold. We need to reposition the brand of insurance and we need to meet the next generation where they want to be met. 

Redefining insurance

Insurance is largely misunderstood and often poorly perceived by society. As a brand, our industry needs a refresh. 

While insurance was built to help people in their time of need, that aspect appears lost on the public. And no wonder given recent headlines concerning rate hikes, market pullouts and unpaid claims. 

Young professionals once perceived the insurance industry as outdated, uninspiring, or behind the times in terms of technology and utility in their fast-paced, digital worlds, but many are coming around. Young people are starting to pursue careers in the industry, rather than simply fall into it. We can and should encourage that trend. 

We can do a better job of telling the stories of our brand and the new opportunities available to those who want to make a positive contribution to society as we embrace technology and use insurance for good. 

Deloitte said it best in its 2024 Global Insurance Outlook, “The potential shift in direction for many in the industry creates an opportunity for insurers to demonstrate how they lead with a more purpose-driven value proposition to attract the right talent. Carriers may need to exhibit not only how they are embracing cutting-edge technology, but the benefits of building a career in an industry whose purpose is not only profitability, but also to make a positive impact on society, helping the world thrive by standing behind other industries to allow for greater innovation, productivity enhancements and calculated risk-taking.”

Advancements in technology, coupled with artificial intelligence, are generating new solutions and insurance products that not only help consumers, but in some cases encourage sustainability and promote social good. To get there, insurers are looking beyond traditional skill sets when evaluating job candidates. Insurers are looking for candidates with technology skills that complement their actuarial or underwriting skills and an ability to work cross-functionally within the company. 

At Gamma Iota Sigma, we are seeing universities address this image issue. More schools are adding risk management programs, majors and certifications to their business schools — giving insurance and risk management new clout. We are also, in general, recognizing a shift in how schools are encouraging a career in insurance — even focusing on the simple notion that the term “risk” may be perceived by many as more intriguing and exciting than “insurance.”

Meeting the next generation

Once we have reworked and updated our industry’s image in the eye of prospective employees, we cannot simply throw a line in the water and wait for a bite. We must understand what the next generation is looking for in a career and adapt accordingly if we want to attract the best talent. 

Fortunately, our industry is gaining traction in this endeavor. There is a documented increase in interest in the insurance industry among students. According to the Gamma Iota Sigma 2023 Recruiting Survey Report, which polls students studying insurance, risk management and actuarial science, more students — 36% in 2023, compared with 25% in 2022 — who had not originally planned to pursue the field of study, chose to study insurance, risk management or actuarial science. Largely, they were attracted by the multifaceted nature of an insurance career. This is a generation that thrives on change and enjoys adapting. Leading considerations for students pursuing a career in insurance and risk management also include stability and earning potential. Nearly 10% also noted the philanthropic nature of the industry as a leading consideration, and another 10% pointed to the industry’s innovative nature.

We have also learned that once we draw in young talent, we need to work hard to keep them. While future growth opportunities are a major reason candidates are drawn to an employer, growth alone is just one factor in their decision-making. For example, the GIS survey found the principal influences on internships for students included opportunities for growth or employment, meaningful work assignments, compensation, mentoring opportunities, access to leadership and rotational opportunities. Once again, this generation brings an advanced skill set in technology; incorporating those skills into their daily work must be a business imperative.

Forging ahead

There will always be a need for insurance. Our industry will continue to be a force that powers the global economy. As such, we must continue to find talented people to not only drive profitability, but to further the industry’s positive impact on society by serving as the financial backbone for other industries. 

To do it right, recruitment requires a long-term effort. Insurance and risk management continues to lose general business students to other industries because they are exposed to career paths and meaningful work experiences earlier in their collegiate careers. Our industry needs to not only maintain an uninterrupted focus on recruiting through market conditions but to recruit smarter and earlier. 

While hard markets and layoffs may be driving headlines, leadership must always be looking forward, which includes building and implementing a plan and long-term strategy. That strategy doesn’t move to the back burner during hard markets, and it should include attracting the best talent to drive your company and our industry into the future. 

Grace Grant is executive director of Gamma Iota Sigma, an international professional fraternity organized to promote, encourage and sustain student interest in insurance, risk management and actuarial science as professions. She can be reached at [email protected].