Iowa insurers work to match jobs, qualified employees
October 2, 2014 by Sharyn Jackson
The job market is perking up, but in one of Iowa’s top industries, matching open positions with qualified employees is a puzzle employers and educators say they are struggling to put together.
With 231 insurance companies operating here and 41,000 people employed in the sector, Iowa is one of the nation’s insurance capitals. More than half of those employees work in the Des Moines area, earning Iowa’s capital the moniker “Hartford of the Midwest.”
But some industry experts say insurance companies can’t fill certain jobs fast enough.
Despite an economic recovery, and more than 9 million people who are unemployed and potentially available to fill new roles, employers are facing a dearth of qualified candidates for “middle-skill” positions across all industries. The problem? Many of the longtime unemployed just don’t have the skills for the jobs that are available, analysts say.
“We have these openings, and Americans just aren’t filling them,” said Ernie Goss, an economist at Creighton University in Omaha. “Workers aren’t coming out of households and unemployment to take those jobs.”
Middle-skill occupations, which account for more than half the nation’s workforce, offer yearly wages from $30,000 to $80,000 and require skills beyond those of an entry-level position.
In Des Moines and West Des Moines, 22,718 new jobs are expected to be created between 2013 and 2017, and more than a third of those will be middle-skill positions with a livable wage. In an analysis by USA TODAY of 125 metros nationwide, Des Moines ranked 40th for middle-skill job growth.
In Des Moines’ insurance industry, claims and policy processing clerks are one such underserved field. These jobs combine both the customer service skills of an entry-level call center job and some of the risk assessment skills required by actuaries with four-year degrees. That leaves claims and policy processing without an apparent supply of talent to fill a projected 8 percent growth in jobs in this field by 2017, according to USA TODAY’s analysis.
Disconnect seen in training, job needs
Elliott Smith, executive director of the Iowa Business Council, cites a disconnect between training programs and the needs of companies for the lack of qualified middle-skill job applicants in many fields.
“I think you’re seeing some frustration and maybe what could be a lack of direct communication between what the employer needs and what the schools are producing,” Smith said. “We are working on that.”
The council includes leaders of Iowa’s 21 largest firms and the presidents of the state’s three public universities.
The insurance industry in Iowa has a steady supply of job candidates coming from Drake University and the University of Iowa, which have two of the top programs for actuarial science, a field of study that uses math and statistics to assess risk.
The students who come through those programs are in demand both by insurance companies and financial firms, but they’re not necessarily going into middle-skill positions like claims and policy processing.
“Our students would more likely be in the finance department and would probably underwrite that policy and do the investigation,” and many of them will have jobs lined up a full year before graduation, said Viana Rockel, associate director of UI’s Vaughan Institute of Risk Management and Insurance.
Taylor Vivant, a senior marketing major at Drake, was drawn to the school because of its location in the insurance capital of Des Moines. She’s taking the undergraduate insurance concentration, offered to students in all fields to give them a background in terminology and concepts in the industry. And though she’ll be looking for marketing jobs when she graduates next year, she’ll be more likely to find them in a field most of her marketing classmates would be unprepared for.
“I have such a greater understanding for how insurance works and how it’s beneficial,” Vivant said. “And because I understand it, I would be inclined to look at insurance before anything else.”
Yet when she browses internal job listings at her current internship, GuideOne Insurance in Des Moines, most of the listings she sees are for claims and policy jobs.
“That’s not a major,” she said.
Insurance jobs lack glamor factor
Students aiming for entry-level insurance jobs are also in high demand, but not enough students are interested in those jobs, said Mike Hoffman, executive director of continuing education at Des Moines Area Community College, which offers a six-week insurance training program in its Financial Services Academy. Courses are sometimes only half full, and others are canceled because of low enrollment, he said.
“Employers are just begging us to get people trained, and we’re struggling to get people into those fields,” he said.
One of the challenges might simply be that claims clerk isn’t perceived to be as glamorous an occupation as, say, surgeon or chef.
“We as an industry still haven’t made insurance an extremely attractive career option,” said Shirley Hoveland, director of employment for FBL Financial Group, a division of Farm Bureau Financial Services in Iowa. “No one grows up saying, ‘I want to go into insurance.’ “
Looking to remedy that is he Institutes, a consortium of insurance education and industry groups that is working to entice millennials with the prospect of some 400,000 insurance jobs forecast to open up nationally by 2020, when many baby boomers will retire. The group’s efforts to “fill the talent pipeline” include connections to internships, an awareness campaign and even a calculator that will tally up skills and interests to determine a job match, said Pete Miller, president and CEO of the Institutes.
For those who do decide to go into insurance, whether right out of school or in mid-career, entry-level jobs are often the best way into the industry. They also pave the way for employers to eventually fill middle-skill roles. Many insurance companies offer training programs in-house that send employees up the ladder.
“We have adopted a ‘hire at the entry level and train them’ type of philosophy for our claims positions,” said Kacie Sires, head of HR and recruiting at Principal Financial Group, whose Des Moines headquarters employs about 6,100 people. “We keep them long enough to fill that.”
Talent shortage a ‘matter of success’?
Even with a shortage of qualified middle-skill employees, recent moves within the industry prove employers recognize the potential of the workforce in Des Moines.
Seattle-based Symetra Financial, which moved its life insurance company to Des Moines earlier this year, will hire 20 to 40 new employees within the next two to four years. Fidelity and Guaranty Life made the move here from Baltimore at the end of 2013. And Athene USA decided to move 220 jobs to West Des Moines from its offices in Topeka, Kan.
As Des Moines’ reputation as an insurance hub feeds itself with moves like these — and top talent gets plucked faster by these companies — the middle-skill shortage could be a good sign.
Said Smith of the business council, “It could be a matter of success breeding a need here.”
Register staff writer Matthew Patane contributed to this report.
Iowa’s insurance sector
• 7.8 percent of Iowa’s GDP in 2011*
• 19.2 percent of the Des Moines metro’s GDP in 2011*
• 213 insurance companies in Iowa
• 81 insurance companies in Des Moines area
• 41,348 employed statewide as of August 2014*
• 24,000 employed in Des Moines area as of August 2014*
*Defined as “insurance carriers and related activities”
Source: U.S. Bureau of Economic Analysis/U.S. Bureau of Labor Statistics