The high unemployment rate has been streaming through the minds of Americans for well over four years now. It has been used as a political grenade launcher, fodder for endless talk shows and a battleground for partisans to espouse their views. What is usually overlooked is the hiring progress that is being made in certain sectors because it does little to chip away at the seemingly immovable number. Northwestern Mutual recently announced one of its highest ever recruiting years with plans for another record year in 2013. National Underwriter Life & Health spoke with Steve Mannebach, vice president, field growth and development for Northwestern Mutual on the hiring trend.
What sparked this latest recruiting drive by Northwestern Mutual?
I would say that more than ever before people are looking for financial advice and planning advice and I think this is driven in part by the fact that over the last four years we have been on a roller coaster and people are looking for guidance at a time when they have more personal responsibility than ever before. With retirement planning shifting away from traditional pension plans from companies into defined contribution plans, I think that more than ever before we are seeing this huge demand for financial advice yet we see a declining number of people offering that advice. So, there is a problem out there that we are looking to solve and that talent gap has not been filled yet and that is why we have set record recruiting goals for ourselves for the next couple of years.
What do the so-called ‘career changers’ bring to the table?
At Northwestern Mutual we focus on organic growth and that means that we are looking for people that are inexperienced to the industry and do not necessarily have financial experience. We feel like it is important to train and teach in the manner that we go about distributing our products. So, when we talk about ‘career changers,’ the average age of our recruit is 30 years old and the median age is 37. The industry average pegged by LIMRA is 57, so, the ‘carrier changers’ I am talking about are the 28-32 year old professional accountant, attorney, or sales person, who has really capped out at an income level or their territory has been shrunk and what they bring to the table is a track record. They bring credibility, especially in the special markets of CPAs and attorneys, which we have seen a lot of because the accountant field and the lawyer field have huge surpluses. We have actually got specific targeted efforts going to those fields including the female marketplace.
Where do college age recruits fit into your recruiting model?
Over 20 percent of our recruiting is coming from college intern conversions; we are going to recruit 3,500 interns this year. These juniors and seniors in college will actually come on board with us and sell our products through joint work and coaching with other reps. When they graduate, one third of them will become full-time reps for us. They start in the business at 22 and 23 and their clientele is not all that great but we are ok with that because what happens is, we teach them to build relationships before people build wealth. We build the relationship through our planning process (we lock the competition out if we have done it right) and we grow with our client so as the client’s needs grow, that rep grows right along with them.
How are your recruiting efforts working to mitigate risks from the much-publicized graying of the workforce in the life insurance arena?
Regarding the graying of the workforce, as you know, succession planning is a critical issue. We have, like many other companies, a distribution force that contains reps that are 55 years or older. We do have a succession pool because we focus on growing talent in the young ranks. We have got successors in place in each of our offices across the country.
Why is now a good time to work for a mutual?
It is a good time to work for Northwestern Mutual, although I cannot speak for other mutuals, because of our products. The value that they provide is created as much by the way we distribute them as by the way that we design them. Our ability to oversee the selection, the quality, the training and the professionalism of our reps yields the attraction of quality clients that understand the value of our process. Clients value the relationship that they have with their reps and what that does is, produce very low lapse rates and myriad other things that lead to lower unit cost and higher value in the form of a dividend (which we will pay $5 billion in 2013 to our policyholders) this in turn, attracts quality financial reps. So that is why it is a great time to work for a mutual.
Is the workforce that you are recruiting adequately diverse?
Diversity inclusion is one of our strategic initiatives going on right now and I will tell you that our mission is to reflect and serve the marketplace. That is our focus. To be honest, we have got work to do. As an industry we have got work to do. But we are proud to say that we have made some advances and nearly one third of our recruits last year were women or people of color so, we are making some progress in that space but have some ways to go.
What does Northwestern do to support its recruits while they build their book of business?
First of all we are proud to say that 60 percent of our reps hold some type of professional designation and we reimburse the costs back to them. To get them started, there is a lot of training before they go into our Fast Track Sales School, which is a three week program. After that, there are daily briefings with an activity coach, a mentor and a case consultation support expert. We work off the theory that you are in business for yourself but not by yourself. A lot of local support in the network office goes into recruits. We also have sales execution teams that operate in the office and do all the paperwork, all the applications, and all of the planning that support the new reps so that they are seeing people and using their time efficiently. Our process is built around people and their concerns come first We want our new reps to understand consumers before they make a product recommendation. People today do not want another product, they want a plan.