Harrington Tells FAIA: Employment Crisis Major Threat to Agencies

An impending employment crisis threatens independent insurance agents and will become disastrous by 2010 unless employers act now, Lisa Harrington, Florida Association of Insurance Agents vice president of Education, told students attending her presentation, “Finding the Perfect Employee (Or, Fishing in an Empty Pond), during Oct. 16 sessions of FAIA’s Management and Automation Training Seminars in Orlando, Fla.

Afternoon seminar participants also discussed “Managing the Bottom Line,” with Jeff Barbacci and Andy Gray; “Setting Up and Securing a Wireless Network for your Home or Office,” with Brian Leibow; and “Document Management Technology: Considerations and Impact on Consumers,” by Bob Larrivee.

Harrington pointed out that FAIA started an Agency Development Task Force to help members keep up with the challenge of finding employees. She gave an overview of the problem, including statistics indicating unemployment has been at record lows from 2001 to 2005.

Employee pipeline ’empty’

“This is not a new problem, everyone is going to retire and no new employees are coming up the pipeline to replace them in the job market,” Harrington explained. She said the current unemployment rate of 3 percent to 4 percent is actually zero unemployment, since everyone who wants a job has one.

“This is not only true with insurance agents,” she explained. “But, there are CSRs in Florida that have worked for every agency in this room.”

Harrington said insurance agencies are competing for employees not only with every other insurance agency, but with every other industry.

She quoted recent magazine statistics estimating that by 2010 there will be 4.6 million jobs available and no one to fill those positions. She called the situation a balance of power, explaining when demand exceeds supply, whoever has the supply has the power.

Harrington conceded that the insurance industry is conservative and has to move slowly, but said it’s essential for all businesses to map out a five-year plan and not wait for a seat in their agency to become empty before hiring a new employee.

“I have conducted training classes during which agencies refuse to allow employees from competing businesses attend,” Harrington explained. “They were afraid their employees would talk to someone from another agency and switch jobs.”

Harrington said the Big “I” recently completed a white paper on Generation X and suggested her students should obtain a copy.

“Members of Generation X, born in the mid-1960s, want to know about their future and if they are learning, they will stick with you every day as long as they are receiving another notch toward their exit strategy,” Harrington explained. She said one way to ensure keeping employees is to be comfortable with youth, saying they are looking for flexibility and training.

Look for the right employee

“You need to hire people, not fill jobs,” Harrington cautioned. “It’s essential to properly select the right person for your agency, if you find him or her and there is no position available, hire that employee anyway.”

According to Harrington, one of the biggest expenses agencies experience is turnover. She said turnover expenses are invisible and no one is following them.

“Turnover subtracts $12,000 to $25,000 from your bottom line every time you lose someone,” Harring-ton said. “Not only have you lost an employee, turnover costs you in morale, no matter why someone leaves, whether it is on their own or they found something better, or because a spouse has accepted a job elsewhere.”

Harrington warned that employees left behind start thinking, “Maybe I should be looking for something better.” She went over a list of attendant costs, separation costs, exit interviewer costs, administration costs, vacancy costs and overtime because the chair is empty.

She provided the class with many solutions, including offering employees incentives to remain with an agency. These included participating in high school and college recruitment programs and hiring interns to work part time and during the summer. She gave the audience a list of 28 junior colleges in Florida where interns could potentially be found.

Five-year plan essential

FAIA’s management expert said it’s essential for agencies to make a five-year plan and proceed to look for potential employees everywhere. She said it’s essential to fill those chairs before they are empty. Harrington used the acronym FISH, find, interview, select and hire.

“Everything goes back to the job description,” Harrington explained. “You can’t find skilled employees unless you are ready.

“When agencies participate in recruiting days they can even be attended by two or three agents from different agencies who talk abut working for Trusted Choice, describing the benefits of being an independent agent and how much money insurance agents make,” Harrington said. She said not to neglect the Invest program and described high schools as a “hotbed” of potential employees when students get out of school and are looking for jobs.

She suggested that high school and junior college students that are interested in business will readily fit in to train as a CSR or producer.

“You can even help them finish college,” Harrington explained. “How much will two years of college cost here in Florida?” she asked. “You can even tell students you will pay $5,000 toward their college costs and they are responsible for the other half. They will really appreciate the help and when they get out you will have someone to fill that empty chair.”

She described FAIA’s Turn Key Recruiting Kit as a valuable asset to be used by members to obtain new employees.

Networking can pay off

Harrington told agents networking is important. “If a policyholder is a golf course, and if you insure different aspects of that business, like the pro shop, the caddies, and the parking lot attendants, then use those connections to look for new employees.”

She advised agencies to avoid attempting to hire employees away from the actual client, but to ask such contacts if they could recommend anyone. She said she had found one excellent employee at a Pizza Hut.

“Don’t hire someone just because you have an empty chair,” Harrington cautioned. She also said that if an employee is not carrying their own weight, don’t keep them around.

Other sessions

FAIA’s MATS sessions continued with Chairperson Veronica Della Porta kicking off a general session with a presentation, “FAIA Today and Beyond.” Other morning events included an ACT video highlighting this agent-carrier real-time interface; a panel discussion moderated by Tim Cotton on “Technology, Is it an investment or headache?” with Carolyn Durland, Mike Mansperger, Janice Sheffield, Dick Brown and Ed Higgins; “Personal Political Power,” with Joel Blackwell; and “Dominate Your Market by Building an Awesome Selling Machine,” by Steve Clark.

A networking lunch featured industry experts and table-top vendors.

During the afternoon there were concurrent sessions in which key topics were discussed, including “The Ten Cardinal Sins Producers Commit, and What to Do About Them,” by Steve Clark; “How to Manage Your Complex Day Using Microsoft Outlook 2000,” with Paul Peeples; “Does Your Disaster Plan Include Business Continuity,” with Richard Roy; and “Document Management Technology: Considerations and Impact on Consumers,” with Bob Larrivee.

Late afternoon concurrent sessions discussed “Key Considerations in Disaster Planning and Management for Insurance Agencies,” by Paul Peeples; “Remote Desktop (AKA Terminal Services),” with Mike Mansperger; “Grass Roots Lobbying for Volunteers,” by Joel Blakwell; and “What Should You Know About Business Continuity Recovery Planning,” by Paul Sullivan.

Oct. 18 began with a continental breakfast and vendor training workshop, followed by breakout sessions: “So You Want to Go Paperless,” with Jay Williams; “Automation Techniques to the Rescue, Allow Microsoft Word to Do Your Work for You,” by Sheri Tingle; and “Managing the Bottom Line,” with Jeff Barbacci and Andy Gray.

Topics Florida Agencies Talent Education Training Development Universities