Insurance Industry Employment Trends: 1990-2017 (April 2017)

Insurance Industry Employment Trends: 1990-2017 (April 2017)

DR. STEVEN N. WEISBART, CLU
June 5, 2017

The U.S. Labor Department’s Bureau of Labor Statistics (BLS) just published data as of April 2017 on detailed insurance industry employment, and the Insurance Information Institute (I.I.I.) website contains updated multi-decade trend data in chart form. (The insurance industry/sector-specific data are not seasonally adjusted and are one month behind the national data; accordingly, the report released on June 2 provides national data for May 2017 and industry/sector-specific data for April 2017.) Data for the last few months are preliminary and are often revised later, but revisions are usually small. The I.I.I.’s slides show employment trends for property/casualty (P/C), life/annuity, health (mainly medical expense) insurers, and reinsurers, agents & brokers, independent claims adjusters, and third-party administrators.

In April 2017, on a year-over-year basis, employment in all major segments of the insurance industry was up to varying degrees.

For the 12 months ending in April 2017, P/C carrier employment rose by 9,700 (+1.7 percent) to 564,200. April is generally a month in which P/C carriers add staff: since 1990, P/C carrier employment has risen in April 15 times, was flat twice, and fell 11 times. The average monthly increase was 1,370; the average monthly decrease was 1,850.

Employment by life/annuity carriers rose in April 2017 vs. April 2016 (up 5,400, or +1.6 percent) to 351,700. However, it is hard to see longer-term employment trends in the BLS data for life/annuity carriers because BLS has reclassified some employment that was previously in life/annuity carriers into other subsectors three times since March 2005. Consequently, it is difficult to know what to use for a baseline. The most recent reclassification ended in March 2015. From then, employment in the life/annuity a segment has generally risen from 318,500.

The health carrier segment had been gaining jobs quite steadily for decades. However, as with the life/annuity carrier sector, the health carrier sector had a major reclassification beginning in March 2015, which reset the sector’s employment from 517,900 in March 2015 to 457,200 in March 2016. Since then employment in this sector grew to 471,300, up 14,100 or 3.0 percent. Now that the Congress and the President aim to repeal the Affordable Care Act, it will be interesting to watch whether this employment growth continues, stalls or reverses.

The agent/broker segment gained 4,100 jobs in April 2017 vs. April 2016 (up 0.5 percent) to 779,000. Employment growth in this category from 2013 through 2015 was extremely strong. Employment rose by 31,600 in 2013, by 52,300 in 2014, by 27,400 in 2015. Employment growth slowed in 2016 to 7,800 and has been -4,400 in the first four months of 2017.

Among the smaller industry segments, reinsurance carrier employment in the U.S. was flat April 2017 vs. April 2016 at 24,800. Employment at independent claims-adjusting firms on a year-over-year basis for April 2017 rose by 1,900 (3.4 percent) to 58,400. This is near the highest that employment at independent claims-adjusting firms has been in at least the last 25 years (the peak was in November 2016 at 59,600). Year-over-year employment in the category of third-party administration of insurance funds rose by 3,200 (1.7 percent) to 188,900. This category has grown quite steadily for over two decades, though not as fast as employment at medical expense insurers. It was set back slightly by the Great Recession, but has generally added jobs since then. It is currently at an all-time peak.

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