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

By Steven Weisbart, Chief Economist 

The U.S. Labor Department’s Bureau of Labor Statistics (BLS) just published data as of November 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 January 5 provides national data for December 2017 and industry/sector-specific data for November 2017.) Data for the last few months are preliminary and are often revised later, but revisions are usually small. The I.I.I. slides show employment trends for property/casualty (P/C), life/annuity, health (mainly medical expense) insurers, and reinsurers, agents and brokers, independent claims adjusters, and third-party administrators.

Employment in the general U.S. economy continues to be strong. In the economy overall, employment in November 2017 on a year-over-year basis rose by 1.5 percent. In November 2017, on a year-over-year basis, employment in most major segments of the insurance industry was mixed to varying degrees, including a continuing retreat from the spike in independent claims adjusting.

For the 12 months ending November 2017, P/C carrier employment rose by 8,000 (+1.4 percent) to 566,900, largely from adding 12,200 jobs in May, June, July and September (likely recent college graduates) but trimming headcount by a cumulative 9,400 in August, October and November. From another perspective, in the 34 months since a low point of January 2015, employment of 514,600, employment in this segment has surged—up by 52,300 (+10.2 percent).

Employment by life/annuity carriers fell in November 2017 vs. November 2016 (down 3,500, or -1.0 percent) to 347,100. Employment in this segment has fallen in five of the last seven months and six of the 11 months in 2017 (one other month had no gains or losses). It is hard to see longer-term employment trends in the BLS data for life/annuity carriers. This is because three times since March 2005, BLS has reclassified some employment that was previously in life/annuity carriers into other subsectors, making it hard 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 to 347,100 (up 28,600, or 9.0 percent). It has remained close to 350,000 for 17 consecutive months.

For the 12 months ending November 2017, health carrier employment rose by 12,500 (+2.7 percent) to 481,900, The health carrier segment had been gaining jobs quite steadily for decades and surprisingly, 2017 has not been an exception to this trend. Employment in this sector rose in nine of the 11 months of 2017 and 17 of the last 19 months. 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 rose by 20,600 or +4.5 percent.

The agent/broker segment gained 6,100 jobs in November 2017 vs. November 2016 (up 0.8 percent) to 787,000. Employment growth in this category in the three years 2013 to 2015 was extremely strong. In March 2013 this segment employed 658,400, so that in 36 months, employment rose by 111,300, or 16.8 percent. More granularly, employment in this segment rose by 31,600 in 2013, by 52,300 in 2014, and by 27,400 in 2015. But the spurt slowed in 2016 (up by 7,800) and in 2017 (up by 3,600 in the first 11 months of 2017). Some of the spurt might simply have been a recovery from the drop in employment in this segment in the years 2007 to 2011, when employment dropped from 667,200 in January 2007 to 642,500 in February 2011 (down by 24,700).

Among the smaller industry segments, reinsurance carrier employment in the U.S. was down by 100 in November 2017 vs. November 2016 to 25,000.

Employment at independent claims-adjusting firms on a year-over-year basis for November 2017 rose by 800, making the sector total 60,400. The year-over-year data obscure the effect of the three major hurricanes and other catastrophes in the September-to-November time frame.  In the month of September, the independent claims adjuster firms hired 7,300 (up 12.8 percent over the August employment level). In October it let 1,400 go, and in November it let another 2,700 go.

Year-over-year employment in the category of third-party administration of insurance funds rose by 1,600 (0.9 percent) to 187,800. 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. In November it reached an all-time employment peak; the previous peak was reached in December 2016 at 187,700.