Insurance Industry Employment Trends: 1990-2018 (February 2018)

By Steven Weisbart, Chief Economist

The U.S. Labor Department’s Bureau of Labor Statistics (BLS) just published data as of February 2018 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 in our charts are not seasonally adjusted and are one month behind the national data; accordingly, the report released on April 6, 2018 provides national data for March 2018, and industry/sector-specific data for February 2018.) 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 February 2018, there were 2.2 million more people employed than a year earlier (+1.6 percent)—an unusually strong increase this late in the business cycle. In the service sector overall, employment was up by 1.4 percent, year-over-year in February 2018. As for the insurance industry, on a year-over-year basis, employment in most major segments of the insurance industry was up varying degrees.

For the 12 months ending February 2018, P/C carrier employment rose by 3,200 (+0.6 percent) to 552,200. Employment in the month of February rose slightly (up 200) but growth in this segment in February is typical; since 1990 it rose 20 times and fell nine times. From another perspective, in the 49 months since the low point of January 2014, employment in this segment has risen by 38,700 (+7.5 percent).

Employment by life/annuity carriers fell in February 2018 vs. February 2017 (down 2,300, or -0.7 percent) to 347,500. Employment in this segment has fallen or was flat in seven of the last 10 months. Even so, it has remained in the range of 345,000 to 350,000 for 26 consecutive months.

For the 12 months ending in February 2018, health carrier employment rose by 15,700 (+3.2 percent) to 509,600. The health carrier segment had been gaining jobs quite steadily for decades. However, 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 52,400 or +11.5 percent.

The agent/broker segment gained 7,800 jobs from February 2018 over February 2017 (up 1.0 percent) to 808,800. Employment growth in this category in the four years from 2013 through 2016 was extremely strong. Employment in this segment rose by 31,600 in 2013; by 52,300 in 2014; by 27,400 in 2015; and by 23,600 in 2016. But the spurt slowed in 2017 (up by 10,200). Employment dropped in January 2018 (down 4,700) but mostly restored that in February (up 4,100). Some of the 2013-2016 growth 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 up by 400 in February 2018 vs. February 2017 to 26,100. Employment at independent claims-adjusting firms on a year-over-year basis for February 2018 fell by 1,200 to 58,600. This is due, as expected, to returning to a more normal workforce after substantial hiring (7,300 in September 2017—up 12.8 percent over the August employment level) in the wake of the extensive destruction caused by Hurricanes Harvey, Irma, and Maria. Year-over-year employment in the category of third-party administration of insurance funds rose by 2,200 (1.2 percent) to 190,400. This category has grown quite steadily for more than 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 near an all-time peak (190,500), set in December 2017.

 

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