Service Jobs - Finance

Finance and Insurance Services (revised Fall 2024)

America has 6.731 million people with jobs in 3 separate NAICS sub sectors that handle financial transactions and not much else. The biggest share of these jobs goes into establishments defined as credit intermediaries, which have 2.6.31 million of the 6.731 million jobs.

Most of the establishments in credit intermediation are still known as banks, savings and loan, and credit unions, but there are others. Credit intermediaries accept deposits and make loans, but credit intermediaries also include lenders that do not accept deposits: credit card issuers, consumer lenders, and real estate credit firms. The banking and savings and loan part of credit intermediation are down 138.8 thousand jobs since 1990 and they continue to decline. Credit unions also declined from 345.4 thousand to 98.6 thousand jobs by the beginning of 2024.

New jobs in credit cards, consumer lending and real estate loans helped make up some losses. The job gains came in consumer lending up from 53.8 thousand jobs in 1990 to a high of 118.9 thousand jobs in 2007, but 94.3 thousand jobs by the end of 2023. Real estate credit companies jumped from 103.9 thousand jobs in 1990 to a high of 332.3 thousand jobs in 2006, but have dropped back to 198.5 thousand jobs by now.

A second sub sector defined as securities, commodity contracts and investments is much smaller with 1.102 million jobs, up from 488.7 thousand in 1990. Brokerage houses and investment bankers are in this sub sector.

The insurance sub sector has the second most jobs in finance and insurance: 2.975 million. Insurance companies added about a million jobs since 1990 with growth rates slightly better than the national average.

Finance and insurance occupations needing college degree skills comes to 3.56 million jobs, which is 52.8 percent of jobs in finance and insurance. The most important professional occupations needing college degree skills are loan officers with 279.8 thousand jobs. Loan officers work with the borrowing public, evaluating and advising clients and processing loan applications. Another 152.2 thousand work as financial analysts and 256.9 thousand work as personal financial advisors, mostly in credit intermediation and security brokerage and investment banking. Financial analysts study business financial statements and advise firms with money to invest. Personal financial advisors do similar work but advise individuals for their personal financial decisions.

There are four professional occupations specialized to the insurance industry: insurance sales agent with 462.6 thousand jobs, claims adjuster with 250.3 thousand jobs, insurance underwriter with 100.2 thousand jobs and actuary with about 23 thousand jobs. Actuaries analyze statistical data and construct probability tables of risk used to set premium rates that will build cash reserves to pay claims.

Money is only kilobytes on a computer, which makes finance and insurance jobs office work sitting at a desk with a computer. We especially suspect office work in finance and insurance because this sector and its sub sectors have the highest percentage of jobs in administration and office support occupations: 32 percent. The overall average among all America’s establishments is 12.2 percent.

Jobs in just the finance and insurance sector include 545.5 thousand jobs as customer service representatives, and 342.1 thousand jobs as tellers. Customer service representatives are one of several important office and administration jobs with employment in every sector of the United States economy. There are now 2.859 million total jobs as customer services representatives with the largest share, about 19 percent, employed in the finance and insurance sector. Customer service representatives handle customer inquiries and resolve customer complaints. Automated computerized voice mail systems do some of the routine customer service work, but not enough to decrease employment, although employment reached a high of 2.919 million in 2019 and stopped growing but stabilized until now.

Customer service representatives do not require college degree training, but they are not walk on jobs like a cashier. For starters, people in these jobs need to speak clearly and grammatically. They have to explain many varied service options and service plans that are increasingly complex and the job requires computer skills since they routinely access computer database information.

Unlike autoworkers, who have to be at the auto plant to do their work, Customer service representatives can be anywhere they have a computer and a telephone. Working from home saves commuter costs and space on already clogged highways. Telecommuting saves business the expense of providing office space, which gives incentive to increase their staff working at home at least some of the time. In addition, office space for customer service representatives could be moved to low rent small towns, rural areas or abroad to work, but over 90 percent of customer service representatives currently work in metropolitan areas.

The claim is made that business is transferring customer service jobs abroad, but it is unlikely their numbers would stabilize at such a high amount if many of these jobs were being moved abroad. Given the complexity of America’s many service plans in loans, credit cards, telecommunications, health care and other areas customer service work will not be decreasing anytime soon. If employment in these areas begins to decline then it will be a blunt message that these jobs are being moved abroad.

Tellers are also an important job to watch. Office automation could just about eliminate teller jobs. Money machines eliminate the need for tellers for check cashing and other basic banking transactions. Writing paper checks requires an elaborate process of handling, posting and clearance that takes much longer and requires more labor than electronic processing at the point of sale.

Available technology permits elimination of check writing, paper and currency in today’s digital world. However, teller jobs are not decreasing and have been increasing modestly in the last few years. Our happiness with these teller jobs has to be modest because the 2023 median annual salary rings in at $37,640, but their continued growth shows America’s resistance to further changing to electronic money. With broadband Internet hookups at more and more households some people are comfortable with their money literally flying through the air. Perhaps paper gives comfort to others with something so important in our daily lives. Whatever the reason America’s refusal to eliminate checks and currency supports many more jobs than technology requires.

Higher labor productivity makes manufacturing more efficient, but continues to eliminate jobs. In a digital world finance and insurance also has the potential to use more efficient methods that will eliminate teller jobs. If Americans keep using things that are inefficient America would have more jobs, but if America wants efficiency they may have to think of shorter hours or some new ways to spread the work.

With a 134.453 million service jobs to divvy up, Finance and Insurance gives us 6.731 million jobs, which comes to 4.3 per cent of establishment jobs. Finance and insurance services employment continues to grow too slowly to maintain its share of America’s jobs. We have looked at 57.1 million service jobs so far but we still have 77.328 million service jobs left to fill. Non-profit organizations are up next. Even though they do not sell much they have service, service, and service.