Navigating the new job market in insurance (2023)

Part 46: Number 1 | March 2023

At the end of 2022, unemployment rates in the APAC region ranged from just 2 percent in Singapore to a still modest 5.86 percent in Indonesia, while Australia and New Zealand held steady at 3.5 and 3.4 percent, respectively.

In practice, this means that the underwriting talent shortage is far from over. “The labor markets in Australia and New Zealand have been marked by three key trends over the past 12 months: record number of vacancies, the lowest number of applications per vacancy and the end of closures impacting the labor market,” said Ben Whitfield, Head of Talent Acquisition at Marsh pacific. “This essentially means there are more jobs being advertised than there are available job seekers.”

Arrivals and departures

Cameron Watson, head of strategy at Fuse Recruitment, says travel restrictions - and less immigration - have contributed to a tighter job market in the region. Looking at Australia, Watson says that "over the past two years, quarantine and restrictions have taken more than 600,000 people out of the workforce: a huge driver of the challenges we now face".

Immigration from New Zealand is also slowly recovering. Net migration only reached positive numbers in September 2022, with a net increase of only 4,559 people. Kiwibank, however, predicts more growth in 2023, predicting a net influx of 30,000 people.

“New Zealand is a great lifestyle choice and I think the government and many organizations have done a really good job of selling New Zealand to the world,” said Gabrielle Cook, national manager of people and culture at Gallagher Bassett New Zealand. "Moreover, we look forward to the kiwis coming home and taking their skills with them."

Certainly, a labor force that is under less pressure can't come soon enough. People who already worked in the insurance sector often had to cope with the workload of missing staff, which affected their own well-being and job satisfaction. In addition, a prolonged lack of resources can limit the growth of the company. “Our latest Hays Salary Guide shows that a lack of skilled professionals is hampering growth and business for 80 per cent of Australian and 57 per cent of New Zealand insurance employers,” said Eliza Kirkby, Regional Director for Australia and New Zealand at Hays .

Perceptions of the market

In Asia, the perception of some markets can make it difficult to attract talent, especially immigrant talent.

“For example, the political turmoil Hong Kong has experienced in recent years, the severe restrictions imposed by COVID, rising Chinese influence and the high cost of living have led to an exodus of talent from the country,” said Ben Ewbank, director of Michael Page. Indonesia. . “Singapore is also facing the challenge of a high cost of living, with many expats today feeling that this now exceeds the traditional amenities that Singapore is known for – cleanliness, efficiency and safety.”

Ewbank says countries like Indonesia and the Philippines still have a reputation for being unsafe, based on historical unrest, weaker currencies, political instability and poor security and health services.

“All of this adds up to discourage foreign workers and make it difficult to attract talent, although all these aspects have improved a lot recently,” he says.

Malaysia has faced similar challenges. Strong economic performance in neighboring countries has led local candidates to emigrate in search of better opportunities. However, Natasha Ishak, regional director of Hays in Malaysia, says the tide could turn.

“Since the election, we have noticed that a large number of returnees are attracted to jobs in Malaysia because they offer a better work-life balance, less pay gap and the opportunity to be closer to family,” she says.

Companies looking to hire foreign candidates should verify that their offer is competitive and in line with changes in the market.

Ewbank says that, except for senior roles and in-demand talent, traditional expatriate packages (including benefits such as accommodation, tuition, flights and health care) are becoming increasingly rare, with employers opting to localize benefits instead.

“Transportation or car ownership programs along with fuel, driver, tolls, and parking fees are common non-salary benefits,” he adds.

Gallagher Bassett New Zealand had a good track record of recruiting abroad prior to the pandemic. Cook says: “We have sponsored people for specialist roles and it has been fantastic for us and for them. We just haven't been able to do that in the past two years. We look forward to recruiting these truly qualified professionals again.”

Insurance industry

All industries struggle to fill vacancies, but insurance jobs have typically always been harder to fill.

“Insurance has historically been a candidate market for a short position,” says Watson. "We've gone from a pretty tough market to a bit tougher than pre-COVID and we're not going to see significant relief this year."

Ewbank agrees. "In more developed markets in general, insurance has struggled to attract young talent as it is not seen as a 'trendy' industry and is often under great pressure with long hours."

He says India appears to dominate the insurance talent market, with many back-office and mid-office professionals hailing from the Asian subcontinent, particularly in technology and analytics. Within other countries, says Ewbank, international players tend to ask their international competitors for senior and more technical positions, as global multinational experience is a must, as is the ability to communicate in fluent English.

At the junior and local level, he says graduate rotation programs can give newcomers a holistic view of the industry.

“We are a company that promotes graduate talent at scale,” says Watson. “We have placed over 250 graduates in the Australian insurance market over the past four years. Young people have so many choices: we see graduates come in and have four or five opportunities to look at."

He notes that insurance for entry-level positions has traditionally not paid graduates at the level that some other industries have. "You get graduates, but do you get the cream of the crop of graduates?" he asks. "Consultancy firms like PwC and big banks pay very well for the talents of graduate students. We're probably a bit behind on that, but I think it's changed and that's a good thing."

Kirby also noted the different strategies for how ANZ insurers attract and acquire the talent they need. “At the entry-level and enterprise assistant level, we often hire graduates from our universities,” she says. “For more specialist roles, employers will consider strong candidates from abroad, particularly from the UK and Ireland, where the insurance industry is quite similar to ours.”

Get proactive

According to Whitfield, companies are now actively targeting great talent rather than passively waiting for candidates to apply or approach them. He says Marsh leverages his employee networks and encourages referrals and referrals.

“We also have a strong view of our internal talent,” he says, “looking at ways we can grow, develop and promote from within.”

The lack of skills has forced companies to be creative. Employers hire people from other industries who have the experience and skills required for insurance operations.

Due to the rise of digitization and data-driven decision-making in business in general, this can often lead to multi-sector insurers competing for the best people.

“As an industry, we are more willing to look for skills that are transferable to insurance,” says Watson.

"For example, we get a lot of engineers who come into the accounts receivable environment, as well as the sales environment, when we look at the brokerage and distribution front end."

Ewbank says digital and analytic roles are always difficult to fill because many industries, not just insurance, are looking for the same skills. “The growth of insurance technology and new market entrants, as well as the need for digital partnerships to ensure a seamless customer journey, have driven demand for jobs such as data scientists, developers and IT engineers.”

In Malaysia, says Ishak, insurers often hire university graduates for technical roles in actuarial, engineering and finance positions. In terms of technical talent, most insurers are also open to talent from other industries due to a skills shortage. However, for positions that require experienced talent, employers favor candidates over the competition.

There is also an opportunity to attract candidates to positions in newer types of insurance that job seekers find intriguing. Kirby says:

“Many candidates are interested in positions in the cyber-insurance industry, in claims, insurance and brokerage.

This area of ​​insurance continues to grow as companies evaluate their cybersecurity in light of recent high-profile breaches and continued industry growth.”

Stick with top talent

No company likes to lose people: it's disruptive and expensive, and it can cause others on the team to rethink their own career options.

If companies want to maintain their peak performance, reviewing their benefits package - including their salary and non-financial benefits - can be a win-win situation.

Ishak confirms, "For positions with similar baseline results, most candidates will move just for the higher salary."

“Companies are being pressured to raise wages to support conservation,” says Watson.

“The 2023 market is still candidate friendly due to supply and demand, and we are also seeing inflationary pressures. We see the market deployment increase by 20 to 30 percent. If you want talent, you have to pay for it.”

Once you become competitive on salary, non-financial factors and benefits can influence a candidate to choose between you and the competition. Watson says he's seen insurers work a lot on their retention strategies over the past four to five years, including nurturing and managing in-house talent, and he thinks they're doing much better.

Decisive factors

Hybrid and flexible working arrangements have emerged as a key factor when job applicants compare positions and decide whether or not to accept a position. "We have candidates who will turn down a position out of hand if it doesn't offer flexibility," says Watson.

Across APAC, Ishak says post-Covid and emerging from the discontent that fueled mass layoffs, workers are looking for appreciation, flexibility, work-life balance and a vibrant work culture.

"The nine to five in the office has been replaced by working anywhere in your free time, as long as you deliver results",

she says, "and the top-down culture has also been replaced by open communication and feedback channels."

Whitfield agrees that candidates are looking for a positive culture, as well as training, career advancement and other benefits. He has seen flexible work initiatives, health and wellness, health insurance, and pay insurance become increasingly popular among job seekers.

With more choices than ever before, entry and mid-level candidates want a clear picture of what the company is willing to invest in their career development over the next two or three years. Insurers that can articulate this well - and deliver what they promise - are strong competitors for top talent and have a good chance of retaining ambitious staff.

Another factor that job seekers prioritize is job security. With loud recessions on the horizon and numerous downsizing of tech companies, savvy candidates don't want to fall victim to last-in, first-out layoff policies.

Watson says, "Safety and stability in a business is important, and if I can see the business has weathered the challenges of COVID, it's a good sign."

From this perspective, the insurance industry has the clear advantage of a long history and well-known and respected brands.

“There is a lot of optimism in the Southeast Asian insurance market for 2023,” said Ewbank. “So far, the region appears unaffected by the global recession. Analysts from Credit Suisse expect growth in the ASEAN-six economies to moderate to 4.4 percent in 2023, from an expected 5.6 percent in 2022. These figures place the region's economic growth well above the global average.”

Work with a purpose

According to the 2022 Great Place to Work survey, millennials value work with a purpose and are willing to turn down or quit a job that doesn't offer it.

Ria Leason, who leads Gallagher Bassett's Australian people and culture team, says diversity, equality and inclusion should be core principles of the corporate culture. “People want to integrate their work and personal lives, build a conscious connection with colleagues and work, and of course develop meaningful career paths,” she says.

Leason also emphasizes that employees want to work for an organization that has a clear purpose, where the work they do every day is linked to that purpose. "Based on feedback from our teams, this is a key driver why employees join Gallagher Bassett and why they stay."

According to The Deloitte Global 2022 Gen Z and Millennial Survey, climate change is another concern for younger workers and what their workplace is doing about it. "ESG has become more prominent," says Watson, "but the question is where it ranks in the top 10 factors that affect a potential employee's acceptance of a position."

Common sense returns

While experts agree that 2023 will be another challenging year in the talent war, Kirby predicts that the wage surplus in 2022 will be dampened by economic changes that determine what employers can afford and what risks candidates are willing to take.

“At the end of the day, budgets can only be stretched so far,” she says. "Even as the cost of living increases, by 2023 major pay increases will only be offered to candidates with the strongest and most relevant skills and experience."

Recruiting abroad can now be fully opened up, giving insurers a larger pool of candidates - all of whom will factor in the possibility of a future recession.

“While professionals with in-demand skills understand that they are in high demand and still have strong bargaining power, they also need to be realistic about their expectations for advancement,” says Kirby. "They still have bargaining power, but they need to moderate it to avoid putting themselves out of the equation."

ANZ Insurance Labor Market Overview

The top five jobs Australian insurers must fill:

  1. Damage experts / advisors
  2. Insurers – SMEs
  3. Contact center agents - accommodation
  4. Brokers
  5. Technical requirements managers

The top five jobs for New Zealand insurers to fill:

  1. Insurers
  2. Brokers
  3. Claims adjusters
  4. Claims administrators
  5. Broker support

Non-financial benefits that ANZ experts value most:

  • More than 20 vacation days per year
  • Continuous learning and development
  • Training (internal or external)
  • A budget for setting up a home office or warehouse

Reasons for the departure of experts from ANZ:

  • Non-competitive salary
  • Lack of promotion opportunities
  • Negative effects on health and well-being

Source: Hays Salary Guide 2022-2023

Retain senior talent

As many people in APAC are living longer and healthier lives, many employees are not ready to hand in their office passes when they reach official retirement age.

One company reaping the benefits of retaining older talent is Gallagher Bassett New Zealand. National People and Culture Manager Gabrielle Cook says the company has developed initiatives to keep and engage these experienced employees. “For example, we contribute to their KiwiSaver [pension] whether they are over 65 or not,” she says. "We appreciate the IP they bring to their role."

Cameron Watson of Fuse Recruitment says: “In general, people are holding out a bit longer now. Certainly, that need for experience is always present, especially in more technical roles such as actuary, insurance and product development.”

Cook says there is still a risk that people will retire soon before they can pass on their knowledge and skills to others. Retaining staff for longer usually gives companies more time to manage that transition.

Some older workers may also be willing to work part-time or on a contract basis, which is invaluable for filling gaps during critical shortages or when a natural disaster triggers a wave of claims.
"We have a very broad network of people who don't necessarily work full-time, but who we can call on if there's an increase," says Cook.

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