Brokers optimistic about the future, but recruitment still an issue

Authored Aviva

• Brokers are optimistic about their business, with 76% expecting growth in 2023 (2022: 43%)
• 34% of brokers are hiring because their business is growing
• 71% of brokers currently have a vacancy; 23% of vacancies have been open for four months or more
• 58% of brokers pay more than expected for new recruits

Attracting experienced brokers remains a key challenge if brokerages are to meet their stated growth ambitions, while the industry as a whole needs to consider how to build the pipeline of new talent, Aviva research shows.

Brokers are optimistic about their growth prospects, with 76% of brokers expecting their business to grow this year, Aviva’s annual Broker Barometer research shows. Just 4% said they expect their business to “moderately decline”.

Help wanted

One-third (34%) of brokers are hiring because their business is growing – the top reason cited by brokers for why they're recruiting. However, brokers are struggling to recruit staff, with 71% of brokers reporting a vacancy – although this is less than last year when 98% of brokers said they were recruiting.

One in four brokers (23%) said they have had a vacancy open for four months or more. The average length a broking vacancy has been open is three months and one week. Of the brokers reporting vacancies, 69% had middle management vacancies, 34% had junior-level vacancies and 33% had senior positions waiting to be filled.

National brokers2 are at the sharp end of the recruitment challenge, with 87% of national brokers saying they're looking to fill a vacancy, with 27% carrying a vacancy for four months or more.

Industry challenge

There is a wider challenge facing brokers – not just hiring staff, but recruiting a new generation of talent to the industry. This is being driven primarily by brokers retiring (30%), which is up from last year when 19% of brokers had vacancies occurring as a result of staff retiring. A further 28% of brokers said staff had exited the industry completely (2022: 25%). This underscores the need for brokers to attract and retain new talent to the industry.

Brokers who are looking to replace staff are primarily looking for experience. Nearly six in 10 (58%) brokers are looking to replace a retired colleague with a mid-level manager. This is even more true where a colleague has left the industry completely, with 73% of brokers saying they're looking for mid-level experience to fill the vacant post.

The race for talent comes at a cost, though. Around six in 10 (58%) brokers said they'd paid more than expected in order to hire the candidate they wanted, considerably up on last year’s figure of 42%. This rose to 65% of brokers who were filling middle management positions.

Only 3% of brokers said they ended up paying less than expected to hire their preferred candidate. Again, national brokers faced the highest recruitment costs, with two-thirds (66%) of brokers saying they'd paid more than expected.

Aviva has developed a range of guides and programmes to help brokers recruit, grow and nurture the next generation of industry talent and leadership.

Ryan Birbeck, Regional Brokers Director, UK & I GI, Aviva, said; “Brokers are a fundamental part of Aviva’s business – their ongoing health and success is critical to our own success. So we take our latest research, which paints a clear picture for the need for brokers to better attract and retain talent to the industry, very seriously.

“We’re continuing to work with brokers to help them build their talent pipeline as well as ensure they are able to equip their people with the necessary skills to enable them to progress their career. We offer them support with recruitment, including access to a leading apprenticeship programme and we’ve developed a wealth of Learning and Development programmes and options for different roles including customer service, account handling, sales and technical training, plus a wealth of on-line learning. We are currently supporting 36 broker apprentices.

“We are also helping more experienced brokers build the core business skills that are required to run a successful brokerage.  Aviva’s Management and Future Leader Programmes help prepare those who are ready to take on more senior roles and to lead their businesses successfully.  So far, we’ve had 99 delegates since 2018, with 30 promotions, 22 now in Board Level positions and 27 running their own business.

“I’d urge any of our brokers who want to find out more about the support available to contact us; we’re likely to have something that can help with the ongoing talent recruitment and retention challenges.”

Are you an insurance broker looking for support with recruitment or retention?

Visit Aviva’s dedicated People page HERE