Minority Report

The insurance industry's aging workforce demands targeted recruitment strategies, according to the Insurance Institute of Canada's research studies. Luckily, the industry already has some answers.

Every industry uses a minimum standard to measure its recruitment and retainment strategy and entry-to-exit ratio. This comparative ratio measures those entering the workforce to those workers retiring from the workforce. For the insurance industry, this comparative standard is extremely low and substantiates the fact that there are not enough entrants to replace those exiting the insurance industry.

The Insurance Institute of Canada’s first demographic report projects that 25% of the current workforce could retire by 2017–approximately 27,500 of the industry’s current workforce. Exacerbating this situation: The under-45 age group, the immediate feeder group to the management positions within this industry, amounts to less than one worker under the age of 45 for every manager currently in the industry’s workforce. As a result, A Demographic Analysis of the Property & Casualty Insurance Industry in Canada: 2007-2017 concludes that “labour force realities in Canada over the next 10 years are really quite straightforward from a demographic perspective–there will be a slowdown in the growth of the labour force; there will be more older workers, many of whom will retire in the absence of an alternative career option; and there will be a much greater reliance on the relatively younger workers who enter the labour force from the immigration stream.”

In our second research study, the Institute concluded that specific strategies for attraction and retention are absolutely essential if our industry wants to overcome both the upcoming labour shortage and the potential knowledge gap that the industry faces in upcoming years.

Retention Efforts
Specifically, there are four cohorts to concentrate attraction and retention efforts on: youth, those under the age of 45, immigrants and aboriginals (especially in Western Canada).

Thankfully, the industry has already done a lot to attract visible minorities. When you compare the number of reported visible minorities within the population with the number in the industry, we see potential for growth–but we also see how much we have already grown as an industry. At present, there are 13.5% self-reported visible minorities in the industry, compared to 16.5% in the general Canadian population. While this narrow gap suggests that the industry is not so removed from being representative of the diversity of the labour market, there is still room for growth, particularly with the new-Canadian population.

As a result, the Institute published the second report as a resource guide, “to help organizations create the strategies needed to meet a company’s hiring needs, training and development assessments and the potential leadership gaps,” says

Dr. Richard Loretto of R.A.L. Consulting, expert on demographic studies, who conducted both parts of the Institute’s research. “The literature review provides an excellent starting point for researching these cohorts, other companies’ initiatives, and best practices as recommended by government and other agencies.”

For example, in terms of visible minorities, the demographic research cites a report that identifies the major factors visible minorities perceive as barriers to their advancement:
1) Perceived lack of fairness in career advancement processes;
2) Absence of role models;
3) Inequality in performance standards;
4) Fewer high-visibility assignments;
5) Although generally organizations strive to create a supportive environment, some visible minority respondents report subtle forms of bias that detracted from their sense of being included.

The Institute’s study then went further by offering action steps for brokerages and other companies so they could develop a more inclusive workplace.

These action points include:
1) Assess your environment;
2) Make diversity a strategic priority;
3) Implement career development systems that are formal and transparent;
4) Develop a robust accountability framework around diversity;
5) Provide support mechanisms.

For more on the best practices for developing a visible minority hiring practice, see the full report. An electronic copy is available for download at www.insuranceinstitute.ca under “Research.” For a hard copy, please call 1-866-362-8585.

Peter Hohman, FCIP, MBA, ICD.D, president & CEO, Insurance Institute of Canada

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