Insurance Industry Employment Trends: 1990-2017 (September 2017)

By Steven Weisbart, Chief Economist 

The U.S. Labor Department’s Bureau of Labor Statistics (BLS) just published data as of September 2017 on detailed insurance industry employment, and the Insurance Information Institute (I.I.I.) website contains updated multi-decade trend data in chart form. (The insurance industry/sector-specific data are not seasonally adjusted and are one month behind the national data; accordingly, the report released on November 3 provides national data for October 2017 and industry/sector-specific data for September 2017.) Data for the last few months are preliminary and are often revised later, but revisions are usually small. The I.I.I. slides show employment trends for property/casualty (P/C), life/annuity, health (mainly medical expense) insurers, and reinsurers, agents and brokers, independent claims adjusters, and third-party administrators.

Employment in the general U.S. economy continues to be strong. In September 2017, on a year-over-year basis, employment in most major segments of the insurance industry was mixed to varying degrees, including a spike in independent claims adjusting.

For the 12 months ending September 2017, P/C carrier employment rose by 15,500 (+2.8 percent) to 572,800, largely from adding 8,900 employees in May, June, and July (likely recent college graduates). Taking the month of September 2017 by itself, P/C carrier employed rose by 3,700 (following a 3,900 drop in August). Employment in this segment in September is unpredictable; since 1990 it rose 14 times, fell 13 times and was flat once. From another perspective, in the 32 months since the low point of January 2015, employment in this segment has surged—up by 58,200 (+11.3 percent).

Employment by life/annuity carriers fell in September 2017 vs. September 2016 (down 600, or -0.2 percent) to 347,100. Employment in this segment has fallen in four of the last five months and five of nine months in 2017 (one other month had no gains or losses). However, it is hard to see longer-term employment trends in the BLS data for life/annuity carriers. This is because three times since March 2005, BLS has reclassified some employment that was previously in life/annuity carriers into other subsectors, making it hard to know what to use for a baseline. The most recent reclassification ended in March 2015. From that point employment in the life/annuity a segment has risen from 318,500 to 347,100 (up 28,600, or 9.0 percent). It has remained close to 350,000 for 15 consecutive months.

For the 12 months ending September 2017, health carrier employment rose by 12,700 (+2.7 percent) to 477,800, The health carrier segment had been gaining jobs quite steadily for decades. However, as with the life/annuity carrier sector, the health carrier sector had a major reclassification beginning in March 2015, which reset the sector’s employment from 517,900 in March 2015 to 457,200 in March 2016. Since then, employment in this sector rose by 20,600 or +4.5 percent.

The agent/broker segment gained 9,300 jobs in September 2017 vs. September 2016 (up 1.2 percent) to 786,300. Employment growth in this category in the three years from 2013 to 2015 was extremely strong. In March 2013 this segment employed 658,400, so that in 36 months, employment rose by 111,300, or 16.8 percent. More granularly, employment in this segment rose by 31,600 in 2013, by 52,300 in 2014, and by 27,400 in 2015. But the spurt slowed in 2016 (up by 7,800) and in the first nine months of 2017 (up by 3,200). Some of the spurt might simply have been a recovery from the drop in employment in this segment in the years from 2007 to 2011, when employment dropped from 667,200 in January 2007 to 642,500 in February 2011 (down by 24,700).

Among the smaller industry segments, reinsurance carrier employment in the U.S. was down by 400 in September 2017 vs. September 2016 to 24,500. Employment at independent claims-adjusting firms on a year-over-year basis for August 2017 rose by 5,300 at 64,500. This is due, as expected, from the hiring of 7,300 in September (up 12.8 percent over the August employment level) in the wake of the extensive destruction caused by Hurricanes Harvey, Irma, and Maria. Year-over-year employment in the category of third-party administration of insurance funds rose by 1,000 (0.5 percent) to 186,300. This category has grown quite steadily for over two decades, though not as fast as employment at medical expense insurers. It was set back slightly by the Great Recession, but has generally added jobs since then. It is currently near an all-time peak, which it reached in December 2016 at 187,700.