Shivani Patel Financial Services, Market Update, insurance...
This update aims to provide Lloyd’s with an insight into the current candidate market (both permanent and contract) for IT and Business & Operational Change roles against the backdrop of Britain’s recent vote to leave the European Union. If you require more detailed analysis of any particular topic, please contact either Sean Anderson (contract recruitment) or Jon Sharpe (permanent recruitment).
Brexit and its impact on the recruitment market
Now that the initial furore at Britain’s decision to leave the EU has begun to die down and a functioning government is in place, the recruitment market has responded positively. Article 50 has yet to be triggered and therefore Britain’s departure and any ensuing changes are at least two years away. This means that some of the uncertainty that had stalled hiring in the run up to the Brexit referendum has been removed and the industry in general is taking a business as usual approach. However, there are still some potential clouds on the horizon and we are closely monitoring the effect that the weakened pound has on hiring as well as the possibility of a dip back into recession. Both could cause hiring plans to stall and permanent candidates in particular to hesitate to move to new roles, potentially exacerbating any existing candidate shortages.
Key skills shortages in the change sector
As organisations continue to evolve and make demands on a skilled workforce that is already in scarce supply, we have identified a number of shortages emerging in the change sector in the Insurance industry. There are particular challenges around the following roles at the moment:
Delegated Underwriting Authority (DUA) change roles - Since the change to the FCA requirements in 2015, we have seen a shortage in associated DUA change roles, in particular contract roles. This is mainly due to the large number of companies needing to undertake similar changes at the same time, putting pressure on an already limited talent pool. There are already few people with the necessary skillsets and exposure to this kind of project and these are not readily available in the marketplace and are unlikely to leave their current positions.
Permanent Business Analysts - There is a wide ranging shortage of permanent change Business Analysts with four to seven years of experience across the Insurance industry. This has largely been a result of the lack of hiring of junior BAs during the previous recession as well as the cut back in the number of graduate programmes during this period. The problem has been compounded by salaries not increasing in line with contract day rates resulting in more BAs at this level being attracted to contract roles.
Technology Solution Architects - We have seen a shortage of good solution architects across both permanent and contract marketplaces. This is mainly because a business facing solution architect is a relatively new concept in the insurance industry and so finding the people with the right skills is challenging.
Solvency II - There is a general shortage of Solvency II Project Managers and Business Analysts but those with Pillar 3 experience are particularly scarce. This is down to all underwriters going through Pillar 3 projects simulaneously. Projects have not yet completed and contractors are therefore not yet being released into the marketplace. There is little incentive for a contractor to leave a current project to start a similar one elsewhere.
What do these skills shortages means for clients?
Where competition for particular talent pools is strong clients need to maximise their chances of attracting the best talent. Key factors include ensuring your hiring process is as streamlined as possible, and checking that you are offering competitive rates/salaries. Sometimes it will be effective to take a flexible approach, e.g. broadening scope of search to outside the insurance industry to other finance industries to find those with the right skills. Making sure that your agencies are well briefed throughout the hiring process is important, the more information hiring managers can provide, the better our search. Feedback needs to be prompt – it can seem a small detail at the time but it’s things like this that affect a company’s image in the marketplace.
The perception of Lloyd’s in the marketplace
When candidates are scarce, companies need to work hard to attract the talent that is out there. Bad experiences are often more shared in the candidate community than good ones, so companies need to be prepared to be reflective and honest about the image they convey.
In general Lloyd’s has a solid reputation in the marketplace. For contractors it is seen as an opportunity to interact with all participants in the underwriting market. They recognise it as offering the potential for great exposure if they get it right. Prospective permanent hires see it as a dependable stepping stone on their CV and it perhaps appeals more strongly to mature candidates who see it as a ‘safe’ option.
Salaries and rates are an important factor in finding the right talent and Lloyd’s is seen as competitive in this area. Recent rates offered have been above market and the permanent comp & bens is seen as good with attractive bonus schemes.
Challenges/opportunities in the coming months
Across the Insurance sector there is some change fatigue setting in. There has been a lot of investment into largescale projects as a result of Solvency III and the appetite for investing in major projects has started to wane. The upside to Lloyd’s is that it is currently running the biggest change projects in the sector and therefore this will make Lloyd’s attractive to talent looking to stay in the area. However the overall tightening of funding and reluctance to move from one project to another similar project has caused some candidates to start looking outside the sector.
The recent departure of some senior managers at Lloyd’s may provide a perception challenge in the marketplace and it will be important to stress to hires that this will not have a negative effect on Lloyd’s or the projects. Permanent candidates in particular want to be sure that they are moving to a stable environment. There is also some scepticism as to the value of TOM in the candidate marketplace which may pose some challenges to hiring. We will work closely with you to ensure that the right message is communicated to the market.
Specific hiring challenges
The shortage of Solvency III talent in the marketplace makes the hiring process crucial. For us to be able to find the right candidates for each role, it would be useful for there to be regular agency briefings with Resource Solutions and the hiring managers. For challenging roles we find these an effective way of understanding individual hiring manager requirements, it is a good opportunity for the hiring manager to provide overall feedback and it’s a chance for agencies to be able to talk about the talent pool for specific roles and manage expectations. The earlier we receive feedback the easier it is to hone the search. Feedback is also an important part of a candidate’s perception of a company, if timely feedback is not able to be provided, it can reflect badly on a client. These specific hiring challenges are minor and easy to resolve and we are keen to develop a close partnership which will help achieve great results for Lloyd’s in the coming months.