With the disheartening news that Norwich Union will be cutting a further 1700 jobs, it is easy to get the feeling that insurance companies are being hit hard by the downturn in the economy. However recent announcements by both Esure and Admiral have been swept to one side as the interest in bad news in this sector grows.
Yes, Norwich union has announced (along with many of their competitors) that they will be losing 1700 positions from their offices in York and Norwich as part of a three year “efficiency drive” and they say it has little to do with the current economic conditions. The company has announced an increase in its operating profits and shareholders received their full dividends this year.
Other insurers have accepted grants in order to be able to announce increases in their workforces. Esure has said they will create 500 jobs – 250 in the next 18 months and 250 by the end of 2014. Most of the positions will be based in the Glasgow office. They currently have a total of 610 staff.
The Scottish Government has backed Esure’s announcement and supported the expansion by offering them a Regional Selective Assistance Grant worth 1.4 million. A Financial Jobs Taskforce has been created in Scotland to support businesses such as Esure in retaining and improving the skilled workforce. This has made Scotland a perfect place to do business.
The Welsh Assembly Government have also taken the initiative by offering motor insurer Admiral a500,000 investment. This has enabled them to announce an increase in its workforce of 119 people in Swansea. They plan to employ these people over the next 18 months.
Admiral plan to move out of their current building and move into the Ellipse building, which is a flagship office building built in partnership between the Welsh Assembly Government and Babcock and Brown. Admiral currently employ 2,700 people based in Cardiff, Swansea and Newport and have seen their workforce grow by more than 350 in the last year alone.
So it seems that two major insurers have been bucking the trend and have been able to find ways of improving their business and are employing more staff rather than laying off. While Norwich Union seem to feel that cost cutting measures are the best way to ensure happy shareholders, the cases here do show that expansion can be a good long term strategy with the right help from the Government.
While that help seems to be forthcoming in Scotland and Wales, insurers based in England have been laying staff off. Perhaps the focus on London by England’s Parliamentary leaders has blinkered them to the rest of their nation’s plight?
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