Nationwide said Friday it plans to cut about 5% of its workforce over the next 12 months.
Nationwide, the insurance and financial services company, said the job cuts will come from its general insurance business and technology teams. Its financial services business will not be cut. Nationwide said it expects layoffs from the cuts to be minimal.
“Over the next 12 months, our (General Insurance) division and certain of its support functions, including technology, will be operating with reduced headcount overall,” Nationwide said in a statement. “This is due to a variety of factors, including employees voluntarily transferring to other roles within and outside Nationwide, not filling vacant positions where possible, business slowdown in underperforming areas and changes to our operating model.”
Nationwide said the cuts were necessary due to “changing business needs.”
“As the market changes and we continue on our path to modernization, we are positioning our P&C and supporting technology teams to serve our members and agents for many years to come. These periodic business strategy updates typically include staffing changes – increases in some areas and decreases in others – based on changing business needs.”
The company said Friday that it was difficult to say at this time exactly how many jobs would be affected or where those jobs would be located.
Nationwide employs approximately 24,000 people, including about 11,000 in Ohio, which translates to 5% of the total employment, or about 1,200 people.
“We cannot estimate the total number of jobs affected,” the company said. “Eligible employees can apply for hundreds of open positions across the country.”
Nationwide is banking on reducing staffing and reducing the need for layoffs by not filling vacancies.
“Reductions in workforce are always a last resort and we will support employees through this career transition,” the company said. “All affected eligible employees will be provided with 60 days’ formal notice, severance pay and outplacement services. We are committed to working through this period with the utmost respect and full support for those affected.”
more:New ways of working: Nationwide redesigns, consolidates office space in the work-from-home era
Nationwide’s announcement comes amid job cuts at insurance companies across the U.S., particularly in the property-casualty industry.
An analysis by S&P Global Market Intelligence estimates the industry is set to cut at least 6,800 jobs in 2023. About 20 airlines cut staff last year.
Liberty Mutual and Grange cut jobs in Columbus last year.
The cuts come as drivers and homeowners are having to pay the price of soaring inflation, including premiums that insurers blame on distracted driving and costly car repairs. Auto insurance rates have risen 19.5% over the past year, more than any other category, according to federal inflation data.
Like other insurers, Nationwide has been hit by high claims costs due to natural disasters and has been forced to withdraw from some parts of the country.
Nationwide has also imposed significant price increases on pet owners and terminated insurance for approximately 100,000 pets nationwide, citing rising veterinary costs and other factors that threaten the long-term viability and profitability of its pet insurance business.
Still, Nationwide reported record revenue of $60.3 billion for 2023.
Email: mawilliams@dispatch.com
Bismarck Williams
