FINSwire Jan 20 2011

Health Insurers Cut 1,000 Jobs in November

By finswire team

Health insurers looked like rare islands of calm when much of the industry started casting off employees in the recent recession. Now it seems they could only dodge the storm for so long.

In November, the most recent period for which data are available, health insurers shed 1,000 jobs, a 0.2% drop, according to an analysis of U.S. Labor Department data by the Insurance Information Institute, a trade group.

The figures are even grimmer for the year between Nov. 2009 and Nov. 2010. Health insurers cut 15,600 jobs during that period, a 3.5% reduction that brought total employment in the sector to 424,300.

Judging from what some health insurers have said in recent months, the employment picture may not be improving soon. When UnitedHealth Group announced quarterly earnings last fall, an executive reiterated plans to cut $1 billion in costs over five years, including through greater use of automation.

Even with the drops recorded for November, health insurers still hadn't slashed as many jobs as some other parts of the industry in recent years. Property/casualty insurers, for instance, have shed nearly 30,000 jobs since the recession began in Dec. 2007, a 6.1% drop, according to the insurance institute. Health insurers have cut 17,600 jobs, or 4%, over that period.

Employment elsewhere seems to be rebounding, with both life insurers and agencies/brokerages adding jobs in November compared to October. Health insurers still appear to be heading in the other direction.

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