London market hiring slows despite growing talent shortfall

The London insurance market is facing a growing recruitment paradox, with firms cutting back on early careers hiring despite warning of a worsening long-term talent shortage.

Speaking at a London Market Group (LMG) press conference yesterday (6 July 2026), chief executive Caroline Wagstaff said recruitment had slowed significantly as firms responded to softer market conditions and uncertainty around artificial intelligence (AI).

“Hiring is down by 25% last year and it’s predicted to be down by another 25% this year,” she said.

Wagstaff warned that the industry’s challenge had shifted from attracting young people into insurance to persuading employers to keep investing in entry-level talent.

“It doesn’t seem to be a supply problem anymore, it’s a demand problem,” she said.

LMG chair Chris Lay added that the market’s ageing workforce meant delaying recruitment now would create bigger problems later.

“We have an ageing workforce,” he said. “The appetite for hiring has dropped off dramatically this year.”

Lay said firms were pausing recruitment as they weighed the effects of softer market conditions, AI and outsourcing on future workforce needs.

“We don’t quite know what AI will do in the transformation process, what type of skills we need in the future,” he said.

Long-term outlook

The comments came as the LMG promoted its Futures Academy initiative, which aims to connect young people from lower socioeconomic backgrounds with careers in the London insurance market.

However, Wagstaff stressed there was little value in encouraging more students to consider insurance if firms were unwilling to recruit.

“My concern is always there’s loads more we could do to attract people, but if we’re not actually going to hire them at the end of it… we have to kind of balance this supply and demand,” she said.

Lay also warned that the proportion of London market employees under 30 could fall to single digits within the next decade unless recruitment improves.