# Insurance March employment figures at odds with other industries

On May 8 the Labor Department reported that the U.S. labor market lost a historic 20.5 million nonfarm jobs in April, sending the unemployment rate to 14.7 percent. The worst affected sectors are leisure and hospitality, which lost 7.7 million workers.

Dr. Steven Weisbart, Triple-I’s chief economist, points out that the employment data for March 2020* for the insurance industry are startling largely because they are at odds with employment changes in many other lines of work.

• Employment at property/casualty carriers held steady in March 2020 at 559,100–the same as in January and only 800 fewer than February.
• Employment at life/annuity carriers held essentially steady in March 2020 at 347,600–the same as in October 2019 and down a bit from the 348,000-349,000 in November 2019 through February 2020.
• Employment at health and medical insurance carriers rose in March 2020 to 585,100–its highest-ever level, up 1,500 from February 2020.
• Employment at agencies and brokerages rose in March 2020 to 852,400–its highest ever level, up 1,700 from February.

* The insurance industry/sector-specific data are not seasonally adjusted and are one month behind the national data.

# Making sense of the dip in property/casualty carrier employment

By Dr. Steven Weisbart, Chief Economist, Insurance Information Institute

On a seasonally-adjusted basis, the number of people working for property/casualty (p/c) insurers has been dropping continually for two years (since February 2017), from 551,200 to 520,700 (the preliminary estimate for February 2019).

Seasonal adjustment plays a small part in determining these numbers. The not-seasonally-adjusted p/c carrier employment for February 2017 was 549,500, and the February 2019 preliminary estimate was 518,600.

What’s going on? Is this a trend? Based on the numbers alone, it’s hard to tell. Consider the following graph of seasonally-adjusted p/c carrier employment since January 2011 — 18 months after the official end of the Great Recession:

Don’t be misled by the spike in March 2015-March 2016. This is how the Bureau of Labor Statistics incorporates a change in classification—that is, in this case, some people who were previously not considered employed by p/c carriers were, as of March 2015, now considered as employed in this industry. Rather than an instant change, the adjustment is made over twelve months beginning and ending in March.

Since the data that begin in March 2016 also show a downtrend, it is easy to infer that, if there had been no reclassification in 2015-16, the downward trend that started (on the graph) in 2011 would in 2019 probably show p/c carrier employment at or below 500,000.

Although we don’t readily have policy counts over that span, it is reasonable to assume that, with growth in the population and the economy, p/c carriers are growing, and doing so with fewer employees. It is likely that at least some of this is due to the use of digital methods for activities that humans previously did. P/C carriers are becoming more productive.

# Insurance Labor Outlook 2018 Q3

The U.S. insurance industry continues its hiring spree in 2018, with 63 percent of companies saying that they plan to increase staff during the next 12 months, according to a new Jacobson and Ward Group survey.

The primary reason cited for hiring is the expectation of an increase in business volume – 66 percent of companies listed this as the primary reason-to-hire. Business expansion and/or entry into new markets was listed as the second most popular reason for hiring (43 percent).

The most difficult to fill positions are executive, technology, and actuarial, while the biggest growth is expected in technology, claims and underwriting roles.

“The insurance industry is coming face to face with an unprecedented talent reality,” says Gregory P. Jacobson, co-chief executive officer of Jacobson. “Virtually non-existent unemployment, an emerging skills gap and impending mass retirements of the industry’s continually aging workforce are challenging insurers to reevaluate their current staffing strategies. This survey will provide a baseline from which insurers can make necessary adjustments to build a successful workforce.”

When it came to reducing staff, 11 percent of companies reported that automation will be the primary reason for reductions in staff during the next 12 months followed by reorganization at 9 percent.

The Jacobson Group and Ward Group conducted a webinar to review the trends uncovered by the survey. The webinar can be viewed here.

The I.I.I. tracks insurance industry employment trends here.

# Insurance industry employment by the numbers

Today’s Insurance Information Institute (I.I.I.) Daily reports that the U.S. Labor Department’s Bureau of Labor Statistics (BLS) just published data as of May 2017 on detailed insurance industry employment.

Updated multi-decade trend data in chart form is available at the I.I.I. website. The I.I.I. slides show employment trends for property/casualty, life/annuity, health insurers, and reinsurers, agents & brokers, independent claims adjusters, and third-party administrators.

In May 2017, on a year-over-year basis, employment in most segments of the insurance industry was up by varying degrees: P/C carrier employment rose by 11,200 (+2.0 percent) to 566,800.

Data for the last few months are preliminary and are often revised later, but revisions are usually small.

# Latest On Employment Trends

What are the latest employment trends for P/C, life/annuity, health insurers, reinsurers, agents & brokers, independent claims adjusters and third-party administrators?

The U.S. Labor Department’s Bureau of Labor Statistics (BLS) just published data as of November 2016 on detailed insurance industry employment and the Insurance Information Institute (I.I.I.) website contains updated multi-decade trend data in chart form.

Some of the key takeaways:

—In November 2016, on a year-over-year basis, employment in most segments of the insurance industry was up to varying degrees. Commentary by Dr. Steven Weisbart, chief economist for the I.I.I.:

“For the 12 months ending in November 2016, P/C carrier employment rose by 9,600 (+1.9 percent) to 523,500. However, this result does not echo longer-term trends. Over the last four years, for example, P/C carrier employment has risen and fallen in a narrow range of 510,000 to 530,000.”

—The agent/broker segment gained 900 jobs in November 2016 vs. November 2015 (up 0.1 percent) to 778,400. Employment growth in this category in the last three years has been extremely strong.

—Among smaller industry segments, reinsurance carrier employment in the U.S. fell in November 2016 vs. November 2015 (down 700, or -2.7 percent) to 24,900.

—Employment at independent claims-adjusting firms on a year-over-year basis for November 2016 rose by 2,400 (4.2 percent) to 59,200—the highest employment level seen for this segment in at least 25 years.