Insurance Post

Industry recruitment and salaries set to rise


A recent survey conducted by Freshminds on behalf of Joslin Rowe shows an encouraging level of optimism in London's financial institutions. Buffy Stock says the insurance sector performed particularly strongly in terms of business confidence, though skills shortages still need to be addressed

As the second in an annual series on recruitment, retention and remuneration trends, a new survey was conducted by independent research firm Freshminds on behalf of Joslin Rowe, the financial services recruitment specialist, and the Corporation of London.

A total of 128 key financial services companies - more than a quarter of whom were from the insurance sector - responded, with the survey designed to gauge perceptions among some of the sector's most influential employers during the first quarter of this year.

In analysing the results, it becomes apparent that a great deal has changed within the industry during the last 12 months. Confidence has improved and, as a result, recruitment is predicted to grow. In fact, the majority of firms - 85% - describe their company's level of business confidence for 2004 as 'optimistic' or 'very optimistic', with the highest proportion of very optimistic responses coming from respondents within the insurance industry.

The impact of this increased business confidence appears to be filtering down into headcount: 20% of respondent companies from the insurance sector say they are planning to increase their claims recruitment levels during the rest of 2004, with 22% planning to increase recruitment activity within broking and underwriting. Even more importantly, less than 4% of insurance firms say they intend to decrease their insurance recruitment activity this year.

While it is encouraging to see the insurance industry looking so confidently towards the future, skill shortages remain a massive issue for the industry.

A total of 63% of respondents admitted difficulties in recruiting for specific skills during 2004 - a worrying increase from the previous year's figure of 55% - and the results reveal that the insurance sector was particularly hit by skills shortages in underwriting and claims disciplines.

Firms indicate that their most successful recruitment methods are recruitment consultancies, employee referral schemes and the use of company websites.

Employee retention

Retention is less of a problem. While the median length of service across the financial services industry is five years, there is a slightly higher proportion from the insurance sector of those working for longer than seven years. In fact, insurance companies are one of the few industry areas to state they feel the average staff tenure is increasing.

Offering a competitive remuneration and benefits package and, more importantly, benefits that staff actually desire, is an excellent recruitment and retention tool and demonstrates that an organisation cares about its employees.

According to the survey, insurance professionals can look forward to a pay increase of up to 5% in 2004, while employers in this sector see bonuses, healthcare, contributory pensions and life assurance as the most important benefits in their employees' eyes. But is this really what workers in the insurance sector want?

In a separate survey on employee benefits conducted towards the end of 2003, the majority of insurance workers indicated that their most desired benefits included more than 25 days of holiday each year, training and development and non-contributory pensions. Clearly, comparing these two lists shows some interesting opportunities for developing the retention policies of the future.

As interesting and valuable as these headline results are, some of the survey's most illuminating findings are not in the pie charts, or straightforward 'yes' and 'no' answers to predetermined questions, but rather in the anecdotal comments that companies are keen to share.

Benefits of diversity

Nowhere was debate more active than in the questions on diversity. The hard facts from the survey indicate that more than half of respondents are actively trying to increase diversity within the workforce. Of these, 63% offer diversity training, while 37% provide work experience for local students or mentoring in local schools.

The same group of respondents was asked to explain what they perceived the benefits of diversity to be. This provoked a variety of responses.

Some companies see diversity as a mechanism through which they can widen their skills base - enhancing creativity and alternative ways of thinking.

Diversity policies are also believed to produce improvements in retention and motivation. A broader knowledge base is thought to provide more transferable skills, giving employers a more flexible work-force and employees more scope to diversify into other areas of their organisations. Another important consideration for some respondents is the 'brand image' of their company, the feeling being that it is important to be seen as an inclusive and open employer.

Yet others say business pressures mean that finding the best person for the job is the number-one priority, and creating diversity in the workforce comes second.

Certainly, diversity is more than just providing a varied selection of CVs. Human resources departments and agencies need to work together to ensure that job seekers - who would never have traditionally realised the insurance industry is open to them - realise opportunities are there.

While this is something that can only be achieved over time, it will go a long way to easing the skills shortages from which the sector still suffers.

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