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Actuarial redundancies

C

Cardano

Member
One of my exstudents, who is a trainee actuary, phoned me today to say there had been a number of redundancies of actuaries at one of the large consulting firms.

I doubt this will be a one off. Can anyone add anymore information.

A crash in actuarial wages (which are too high anyway) has got to be on the cards
 
Not heard anything recently but a while back I heard some consultancies were offering reduced hours (for reduced pay!) rather than redundancies. So maybe its the same firm and the offer for reduced hours didn't get enough buy-in.

What I'd like to know is if people are being made redundant, how easy are they finding it to get work? Are they moving into other careers? If so, which.

Definitely worrying times.
 
Its KMPG offering the shortened week for less pay but i've not heard of any firms laying off a bulk load of people. I recently moved out of a consultancy mainly because I didn't like it, but also because pensions consultancies will inevitably become less busy over the next 10 years if DB schemes take up the buyout route more quickly than expected. I didn't see myself as in the best 50% of the people there so thought when push came to shove I'd be shipped out reasonably quickly!

As for actuaries wages being too high, I disagree entirely I'm afraid. In my opinion the hurdle to entry ie. the exams are far harder than any that a doctor/solicitor/lawyer etc or any other well paid professionals would have had to pass and therefore only a limited few are capable of qualifying. I'd be surprised if more that a percent or so of the population would have the intelligence or drive required to pass all the exams and fair play to the ones who have (I certainly haven't yet!) - they deserve the wages they get for having achieved something most people are not capable of :)
 
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I know someone who works at KPMG - they told me the four day week didn't apply to the actuaries in the company. Think they also printed something in The Actuary to clarify this in the issue after the one where they talked about the 4 day week.

Certainly from friends who work in consultancies I've heard that recruitment within the consultancies have definitely reduced... however it also sounds like workload per person is now more... so eventually they will have to start recruiting again.

On the other hand the reinsurance market seems to be in full recruitment swing at the moment - I know via recruitment consultants of at least 4 reinsurers who currently have actuarial vacancies.

Been told the actuarial market is pretty countercyclical in terms of the economy... though whether the actuaries are sustainable as a profession in the long term is another matter altogether...
 
In plain English, I'd punch a guy if he said to me that we earn too much: going to work on a daily basis to do stuff that only a few understand, getting back home to get ready for a night of hard studying (the levels of which are just as hard as my final year in my university degree) makes this profession one of the most difficult...unless you're hell-bent on working as a nuclear-physicist at NASA.

I'm justifying our earnings, not complaining...would I still be here if I earned a little less? Of course!
 
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Ok, so far we've had 167 viewers of this thread and not a single confirmation of the alleged redundancies at the "large consulting firm". Can you shed any more light Cardano? For example were these people working in Life, Pensions, other? I can't claim total knowledge of the whole market but I'd expect to have heard if this was on the Life side. I suspect someone's got their facts wrong (either that or people are being very tight lipped - or none of that consultancy's employees use this forum!)

We shouldn't make too much of the KPMG offer. The move was offered to the actuaries to be consistent with the accountants. Staff were offered the opportunity to work a four day week for a while or take a 3-month break at 30% pay if they desired - but with no pressure to take up the offer. Most remained on a 5-day week on full pay. I actually think this was good downturn management and the sort of thing the industry should look towards.

I don't believe actuarial wages are too high. Perm salaries are comparable with other top professions. Contract rates may look high but the hourly rate is actually not much more than a plumber would charge. Of course, turkeys don't vote for xmas!
 
I was hoping someone else might actually shed some light on this as I'm not involved in the actuarial world myself. The lad who told me works for Ernst and Young, but it wasn't in his company. He had been told in confidence and therefore I do not feel I can put the name up here, but it is a very big accountancy/consulting company and it was in the general insurance consultancy.

As regards the high compensation that actuaries receive, the cold winds of financial reality are likely to blow across the finance industry for some considerable time to come. It is my belief that we are at the beginning of the largest debt liquidation in history and I expect that even I'll be surprised by some of the events in the next decade. All I can say is I'm glad I don't rely on the finance industry for my living.

I might put an essay up on why I think demand for actuarial services might fall dramatically at a later stage, but that will have to wait as I'm too busy at the moment.
 
I look forward to your essay Cardano.

It's all very well saying you're glad you don't rely on the financial services industry, but all my job relies on (and the jobs of at least half the people on here) is that people always need insurance. As far as I can see no matter how big the recession is, insurance will never die out. I'd say that's a pretty safe bet and I'm more than happy with my future career hanging on that particular thread of hope.
 
And insurers need actuaries a great deal more during the downturn. What must be clear to any employer, regardless of the profession, is the value added compared to the remuneration. As long as actuaries add values to the insurance and other finance industries like no other professionals can (eg underwriters, product managers), then remuneration will reflect that.
 
Geoff, I get the impression, you think I don't think training as an actuary is a worthwhile thing to do. I do think it is an excellent training to have, but it also obviously has its limitations. One of those limitations is the limited understanding of how capitalism works. The problem for actuaries in the short and medium term will be the nature of debt revulsion which will follow the debt liquidation. Whereas a reasonably large minority of actuaries may understand what a debt liquidation process is, I suspect very few have any real idea of the psychological and financial consequences of debt revulsion. I can't do this justice in the time I have available as this is the busiest week of my year.
With regard to the point about insurance, of course it will always be necessary. I have never predicted a biblical correction to the insurance industry that is obviously going to happen to the investment banking industry, but I believe it will be adversely affected more than most people on here believe.
I encourage as many of my A level students as possible to do actuarial science degrees and as many of my degree maths, physics engineering and economics students to train as actuaries. I believe the long term future for actuaries is good

Cuiman, The gist of this thread is that the demand for actuaries at the moment may be falling.

(Btw it is not KPMG I'm talking about here)
 
If someone was in a position to confirm this, most likely they would choose not too. It's called sensitivity!
 
For evidence of falling demand, just have a count of how many pages of ads there are at the back of this month's actuary. Definitely looks less than normal to me.
 
There are 20 pages of job ads in this month's The Actuary. In May and April 2009 there were 18 pages. In June 2008 there were 26 pages, in April 2008 30 pages, and in June 2007 21 pages of ads.

Today reed.co.uk lists 96,677 job vacancies. In 2007 there were around 300,000 vacancies. It lists 544 actuarial vacancies today, covering a wide range of roles. In 2007 there were typically 800-900 vacancies. At the start of 2009 this was down to 300-400 vacancies.

It is difficult to reach any definite conclusion, but I think that it is possible that there may be the beginnings of an upturn in the actuarial job market compared to the lowest point during the credit crunch.
 
I didn't see this thread before but if anyone is interested there were a lot of redundencies made in the non life actuarial department of Deloitte.

It was mainly at the lower levels (1-4 years experience I believe). I think the number was 15-20.

I don't work there but know people who do. They basically over hired over the last few years and revenue streams have been hit. Other consultancies look like they are doing OK ish.
 
geoff97531 said:
Its KMPG offering the shortened week for less pay but i've not heard of any firms laying off a bulk load of people. I recently moved out of a consultancy mainly because I didn't like it, but also because pensions consultancies will inevitably become less busy over the next 10 years if DB schemes take up the buyout route more quickly than expected. I didn't see myself as in the best 50% of the people there so thought when push came to shove I'd be shipped out reasonably quickly!

As for actuaries wages being too high, I disagree entirely I'm afraid. In my opinion the hurdle to entry ie. the exams are far harder than any that a doctor/solicitor/lawyer etc or any other well paid professionals would have had to pass and therefore only a limited few are capable of qualifying. I'd be surprised if more that a percent or so of the population would have the intelligence or drive required to pass all the exams and fair play to the ones who have (I certainly haven't yet!) - they deserve the wages they get for having achieved something most people are not capable of :)
Click to expand...


This is an interesting post....A year later in 2010 this same company is looking for filling in about 30 positions in the UK (calling all international actuaries etc...) :eek:
 
jeaneu said:
I know someone who works at KPMG - they told me the four day week didn't apply to the actuaries in the company. Think they also printed something in The Actuary to clarify this in the issue after the one where they talked about the 4 day week.

Certainly from friends who work in consultancies I've heard that recruitment within the consultancies have definitely reduced... however it also sounds like workload per person is now more... so eventually they will have to start recruiting again.

On the other hand the reinsurance market seems to be in full recruitment swing at the moment - I know via recruitment consultants of at least 4 reinsurers who currently have actuarial vacancies.

Been told the actuarial market is pretty countercyclical in terms of the economy... though whether the actuaries are sustainable as a profession in the long term is another matter altogether...
Click to expand...

...it seems to me that the market has picked up for consultancies as well this year....
 
As the austerity measures take effect around the world, there will be a large sell off of risky assets to repay the staggering amount of debt that is outstanding. Actuaries and insurance executives are not by and large sophisticated financial types. In fact they are little brighter than bankers, which isn't saying much. They will be caught largely with substantial proportions of free reserves and regulatory reserves in such assets and there will be some spectacular bankruptcies amongst the worlds major insurers. The same applies to pension funds. Three guesses as to what this means for actuarial employment prospects!
 
i'd say actuarial job prospects will easily outperform job prospects in the wider economy, and probably almost any other comparable profession - with the ever increasing focus on risk management/solvency etc, actuaries are surely the ideal group to tackle these problem, and if we can't, then who else can? We're already seeing SII causing a significant increase in actuarial demand in the general insurance sector, and I think this is one of the reasons for the pick up in consultancy work over the last year. This should continue at least up until implementation of SII in 2012/13.

of course the supply of actuaries could still increase by more than the demand. hopefully they'll make the exams even harder as soon as I qualify ;)
 
mattt78 said:
of course the supply of actuaries could still increase by more than the demand. hopefully they'll make the exams even harder as soon as I qualify ;)
Click to expand...

Unlikely. More likely that they will make it easier!

PS. but then the advantage would be you can say:
"In my days we still did the proper actuarial exams. CA3 had a pass rate of 30%! A friend of mine had to write it 8 times. 8 times I tell you. Not like this nonsense you young guys have to do now."
 
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to make it more funny :p the pass rate on the last session was 20% :eek:
for the non-native speakers of English, this exam is the biggest challenge....:eek:
 
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