It is not just the City landscape that is changing; employers are now less likely to rely on the old-boy network. Rachel Gordon looks at how employers can ensure they find, and retain, the right staff
The streets of EC3 are paved with gold, if the insurance recruitment consultants are to be believed. Most say that good candidates with experience can expect a large pay rise, an excellent benefits package and be spoilt for choice in terms of companies. However, even with so much on offer, the massive cost of housing in and around the capital can be a problem for insurance employees.
The average price of a home is £262,000, compared to £102 330 in the North. London wages may be the highest in the UK but they are often not enough to secure a first foot on the property ladder.
Consequently, some City employers that pay their staff decent bonuses based on performance are being asked by employees to contact lenders and confirm that extra cash will be forthcoming.
Supply and demand
Another key challenge affecting the City is the excess of demand over supply for skilled staff. Hiscox has for two years been ranked as the top financial services company to work for in The Sunday Times, but Sue Smith, director of HR, says finding the best people can be tough, although she admits recent months have seen a surge of better candidates: "I think there is more confidence about moving jobs," she reports.
"People believe there is less likelihood of a recession and they see insurers making good profits, which adds to security. Being in The Sunday Times best-companies-to-work-for list has also helped as we now get more direct applications."
No insurer is finding it easy, however, particularly when it comes to filling vacancies for experienced candidates. Neil Clutterbuck, Allianz Cornhill Commercial's London regional manager, says: "There is currently a dearth of expertise in the City, partly as a result of the wave of mergers and acquisitions that have taken place during the past few years. Well-qualified, experience people have retired, leaving a void."
It is not only insurance companies that say recruitment can be a problem.
Cooper Gay, a Lloyd's broker, has plenty going for it - the firm is currently expanding and with 135 staff is small enough to be personal but also to offer its staff entrepreneurial freedom, according to administration director John Flanagan.
With no external shareholders, many staff have a share in the company and there are plenty of perks, including a generous pension. Despite this, Mr Flanagan says there is a shortage of staff he describes as "mid-seniority" - with five to 10 years' experience. He puts this down to the late 1990s soft market when there were redundancies and under-investment in training across the market. To counter this trend, Cooper Gay takes on graduates and school leavers on an accelerated training programme.
Growing your own is only part of the solution though. For younger employees in particular, a tempting offer can be hard to resist. Alison Taylor, consultant with IPS, comments: "Staff retention is a big issue in the Lloyd's and London market - many young candidates move companies every two years in the first 10 years of their career to meet their expectations and fulfil their goals."
Compliance is now one of the biggest growth areas for recruitment, with regulation by the Financial Services Authority fast approaching. This has been witnessed by Neil Coulson, a partner in the financial services division of Littlejohn Frazer, an accountant specialising in the insurance sector.
He adds that a growing number of brokers and insurers are looking to take on or bolster their in-house accounting teams. "We have the International Accounting Standards approaching in the UK and the impact of Sarbanes Oxley from the US, both of which turn the spotlight on solvency and governance." This is also prompting a fair degree of poaching. Littlejohn Frazer has itself lost team members to the insurance sector.
Obviously when it comes to the technical side - underwriting and claims - insurance experience is essential; but in other areas, such as IT, HR and, in some cases, senior management, the insurance sector is prepared to look outside for the right people. Joe Plumeri is one example - a banking professional who has brought new skills to Willis as its chief executive.
Lloyd's chairman Lord Levene is also an outsider, the first to assume the role, coming from a varied career in business.
Ms Smith adds: "I'm a case in point, joining from a manufacturing company in Teesside. At Hiscox, we're interested in ability, not backgrounds." And Mr Coulson points out that the Lloyd's market has undergone a major regulatory shake-up where the emphasis now is very much on competence.
"The market has changed - you now have large US and Bermudian interests, which are not interested in employing people with family connections and nothing else to offer."
That said, remnants of the old-boy network remain. Royston Betts, a director with Lime Street Recruitment, comments: "It still doesn't hurt to have connections in the right places, but this situation has significantly diminished from traditional levels as excellent graduates from all backgrounds are achieving professional qualifications in double-quick time and challenging the 'jobs for the boys' culture. Even so, nepotism is still prevalent with new entrants to the insurance market helped by having relatives in the right places."
While a word in the right ear can help - and this is certainly not exclusive to insurance - there is no doubt that recruitment consultants are finding these are busy times in the City. There is plenty of graduate recruitment going on, second-jobbers are in demand as never before and managers are urgently needed.
The City is ripe with opportunity. Robert Blackman, senior business manager at consultant Elements, says: "For the right candidate it is not difficult to obtain a good salary increase - and the main shortages are for technical specialists, currently earning around £30,000 to £55,000."
And recruitment consultants are keen to ensure the pool of skilled professionals is larger in future. Amanda McNally, director of recruitment for Hillman Saunders, explains: "In recent years we've been talking to students at City University and colleges in Essex about careers in insurance - the sector needs talking up, it's never been more exciting."
- Gallagher Bassett acquires claims management firm
- Finch and ICB owner on acquisition trail with sight set on €500m revenue by 2022
- Top 100 Insurtech: Quarter four update
- Green light for UK-US insurance trade deal
- Roundtable: Is a single customer view taking off in insurance?
- Analysis: The mystery of the missing Insurance Fraud Taskforce report
- Blog: You really need to listen before walking the walk