Imagine you are CEO of a company and nearly half the employees that make your company succeed will retire in just 15 years. This is a reality for many insurance industry CEOs. Talent shortage is a major, looming problem.
Recent studies by the Jacobson Group and Deloitte provide the numbers, which tell a gripping story: Of the 2.3 million workers serving in the insurance industry, more than 1 million will retire in the next 10 years. The entire insurance industry will have 400,000 positions to fill by 2020. Workers over the age of 45 make up 48 percent of the industry’s workforce. Even more troubling, 70 percent of insurance adjusters are over the age of 40, and 20 percent of experienced underwriters will retire in the next few years.
As Baby Boomers move into a new phase of life, are new workers entering the field to carry the industry forward? The answer right now is no.
The new up-and-coming talent pool is filled with Millennials. In fact, Millennials make up 25 percent of the U.S. workforce and are expected to form 50 percent of the global workforce by 2020.
Millennials, or “Generation Me,” are individuals born between 1980 and 2000, and they have a different perspective than those that came before them. This generation has grown up with almost constant access to technology and is accustomed to instant gratification. Millennials are multi-tasking, tech-savvy, connected, collaborative team players that want recognition, advancement, and to work for collaborative and socially conscious organizations.
The growing problem for the graying insurance industry is eight out of 10 Millennials report having limited knowledge and understanding of the employment opportunities available within the insurance industry.
Another problem for the employee-seeking insurance industry is reputation. According to Valen Analytics, 44 percent of Millennials think working in the insurance industry is, frankly, boring.
Millennials also have less exposure to insurance as they delay homeownership and some put off even owning a personal car. They may not be familiar with the innovation, technological advancements and forward thinking burgeoning in the insurance industry.
As previous generations know, it takes insurance to buy a home or a car, build a business or building, run a company or manage a community. Insurance is relevant, necessary to protecting personal and business investments, and plays a vital role in the economy. To attract Millennials into the industry, insurers need to better tell their story about the growing importance of technology and analytics.
Millennials also need to be aware of how insurers are using social media and are innovating new solutions to meet the demands of cybersecurity, green technology, the sharing economy and other emerging trends.
Given that more than 40 percent of recent college graduates are unemployed and 16 percent are only employed part-time, there is a ready pool of new talent.
Several in the insurance industry have joined forces to demystify insurance and recruit the next generation of top talent to best serve consumers. The Institutes, Jacobson Group, Valen Analytics and Property Casualty Insurers Association of America are raising awareness within the industry about the talent shortage and to attract Millennials. They have launched the Tomorrow’s Talent Challenge Initiative to spark the industry’s involvement in engaging Millennials and efforts to promote science, technology, engineering, and mathematics education and career choices. They also have created the MyPath website, which provides insurance internship opportunities, and scholarship and educational information on the insurance industry’s limitless opportunities.