Major HR Challenge for Insurance Companies: Attracting Young Talent to Maintain Their Dynamism
The insurance sector holds significant weight in the financial industry. Its revenues are projected to reach $7.5 trillion globally by the end of 2025. However, it faces a major HR challenge linked to the aging workforce and the looming threat of an unprecedented labor shortage. According to the United States Bureau of Labor Statistics, 50% of the current workforce in the insurance sector will retire in the coming years, leaving over 400,000 vacancies. Therefore, insurance companies must rejuvenate their workforce to remain innovative and competitive in the market. However, the sector does not appeal to the younger generation, who show little interest in pursuing a career in insurance. What strategies can insurance companies employ to attract, recruit, and retain young talent?
Obstacles to the attractiveness of youth in the insurance sector
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The insurance sector suffers from an unattractive image and reputation among Millennials (born between 1980 and 2000) and Generation Z (born from 2000 onwards). It is often perceived as a conventional, conservative, and uninventive professional field.
Unfamiliar occupations
According to a survey conducted by The Institutes, 8 out of 10 Millennials have limited knowledge of career opportunities in the insurance industry. Young people may not have subscribed to insurance policies yet, and they have minimal awareness and understanding of these products.
Insufficiently competitive salaries and benefits
Young people are attracted to competitive salaries and benefits, but the banking and financial sectors as well as Tech & IT appear more attractive.
Lack of flexibility
Young people seek a work-life balance offered by remote and hybrid work arrangements, but insurance companies do not always guarantee this flexibility.
Lack of investment in skills development
Another factor affecting the attractiveness of insurance companies is a gap in the understanding of skills their employees will need in the future. Young people are eager to learn and acquire new skills to remain employable in an ever-changing job market.
Strategies for insurance companies to attract, recruit, and retain young talent
Developing an attractive corporate culture
Valuing corporate culture, mission, purpose, and emphasizing collaboration, career progression, flexibility, and other benefits are important. Additionally, promoting commitment to sustainable development, which young people are highly attuned to, is a plus.
Promoting career diversity in insurance
The insurance sector offers a wide range of careers (agent, broker, claims adjuster, risk manager, data analyst, cybersecurity expert, etc.). It is important to promote these career options to young people, so they are aware of all the opportunities available.
Emphasizing technology
Insurance companies now offer most of their services through mobile applications (claim submissions, video downloads for claims assessment, inspection planning, claims process tracking, etc.) and utilize Artificial Intelligence (AI) to streamline their processes. Promoting the use of technology in the industry can attract tech-savvy young talent.
Recruiting via social networks
Social media is important and relevant for the younger generation. Insurance companies can benefit in promoting their job offers, internships, and compelling content about insurance careers on social networks (LinkedIn, TikTok, Instagram).
Prioritizing DE&I in recruitment
Millennials and Generation Z are highly diverse populations and expect this diversity to be reflected in the workplace. Preserving diversity, equity, and inclusion (DE&I) in their workforce involves eliminating unconscious biases during the recruitment process. Psychometric tests help in assessing candidates' personality traits, intellectual abilities, behavioral skills, values, motivations, and professional interests independently of their name, gender, age, race/ethnicity, disability, sexual orientation, socio-economic background to better validate their potential.
Taking care of onboarding
Once recruited, it is crucial to support and mentor new hires. Having mentors who will help new recruits network and advise them on progressing in the sector is a real asset.
Investing in training and professional development
It is essential to emphasize job stability in the sector and enable young people to acquire the skills they need to perform and adapt to market changes, offering them career advancement opportunities.
Millennials and Gen Z have begun to dominate the job market. These dynamic new talents seek the energy and flexibility that many industries offer. It is important for insurance companies to consider their expectations and capitalize on this pool of talent to address their deficits in human resources and skills that threaten their business.