Regardless of their positions on the political spectrum, pundits and politicians keep reminding us that no matter how strong the evidence of economic recovery appears, it won't matter as long as the unemployment rate remains high. In an ironic twist (given their status as the most easy-to-attack symbols of everything that's wrong with the business community), the insurance and banking industries could make the difference here.
I&T has reported both statistical and anecdotal evidence that market conditions are improving, which is leading to a renewed focus on growth and is contributing to the biggest IT budget increases in years. Celent projects that global IT spending by financial institutions is expected to reach $363.8 billion in 2011, a 3.7 percent increase over 2010. IT spending in insurance is expected to reach $97.9 billion in 2011, Celent forecasts.
But how much of that IT spend will actually translate into hiring, promotions, training/retraining and general job development? There is evidence that job creation is in fact part of the growth strategies we're hearing so much about. For example, more than half of the respondents (across all industries) to PwC's recently released 14th Annual Global CEO Survey indicated that hiring at their organizations will increase in the coming year.
There are some caveats, though. Fifty-one percent of global CEOs and 55 percent of U.S. CEOs said they plan to increase their head count in the next 12 months but are concerned that they may not have access to people with the right skills in the right places, according to PwC. Fifty-six percent of global CEOs said they were concerned about talent availability, compared to 38 percent of U.S. CEOs. Among the workforce challenges cited by the CEO participants in the PwC research are issues such as integrating young employees and forecasting talent availability in emerging markets.
Inevitably, as insurers continue to refine the multichannel distribution model, update their core systems, and improve compliance and governance, there will be growing demand for workers/professionals with expertise in areas as diverse as social media, analytics, customer service, and, yes, application development and maintenance. Just as inevitable will be battles to secure the top talent in these areas. Will companies be able to find, develop and retain people with these skills domestically, or will they opt to engage them offshore? The development of the 21st century insurance IT workforce will be one of the most complicated -- and interesting -- trends to watch in the post-financial crisis era.