Happy Employees

This issue reveals data and compensation insights gathered from Insurance Journal’s annual Agency Salary Survey. For the second year in a row in the survey’s 15-year history, salary averages reported were higher than ever before.

While that trend may be good for agency employees, agency owners may be struggling to keep pace with growing compensation demands and the industry’s ongoing talent crisis. Competition is fierce for experienced top talent and salaries are rising as a result.

“You have many people who are leaving the workforce but not as many coming in,” says Al Diamond, president of the Agency Consulting Group Inc. based in Cherry Hill, N.J. “That’s going to cause a lot of upward pressure on starting salaries.”

That pressure is causing people to move. “People may find it more advantageous to leave their jobs and go elsewhere so they get paid more …. Getting a 2% or 3% raise every year isn’t going to keep up with the starting salaries as people get harder and harder to find,” he told Insurance Journal.

Competitive pay, job stability and flexibility have become table stakes for companies looking to hire top-tier candidates, said Jen Farrell, director of agent and customer research at Liberty Mutual and Safeco Insurance. The research team at Liberty Mutual surveyed more than 1,100 independent insurance agency leaders and team members for the 2023 Agency Growth Study. As part of the survey, the insurer asked agency employees about the characteristics of their ideal employment situation. Leading the list — remote work and flexibility. Some 54% of respondents ranked flexible hours as a top benefit.

While employees seek flexibility, employers seek experience, reliability and an independent knowledge base, according to Diamond. But experience and knowledge are not easy to find, he admits. “Many agency owners are basically giving up after a year or so of searching and hiring inexperienced people,” he said.

For now, expect continued movement of agency talent. “We’re seeing movement both in producers and in service staff, except the rate of producer movement is declining while the rate of service staff movement is increasing,” Diamond says.

He urges agency owners to remain diligent in their efforts to keep their best employees happy and engaged. That means appreciating people, he adds. “If the employees feel appreciated, they’ll walk through walls and fire to protect the agency and their jobs. If they don’t feel appreciated, they’re looking for the next job.”