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Workers’ comp industry optimists expect that President Trump’s economic policies will help propel
Optimistic Voices additional insurer premium volume growth through 2017 and even beyond.
Recent growth in employment and
wages are expected to generate billions
in new workers’ comp premiums
written. Factors like lower business
taxes, reduced regulatory burdens and
shifts in trade policy espoused by the
president could fuel further growth.
“Certainly the proposals of the
current president suggest it is quite
possible we will have an increase
in employment in 2017,” including
policies that motivate companies
to hire domestically rather than
overseas, all of which would add
to workers’ comp premiums, said
Steven N. Weisbart, senior VP and
chief economist at the Insurance
That would also presumably spread
revenue to other industry service
providers. More jobs inevitably mean
more injured workers to service,
especially the newly hired.
Weisbart calls his viewpoint
“mildly optimistic.” He isn’t alone. His
optimism is shared by others who pay
close attention to how economic trends
impact the workers’ comp industry.
Shifts in business and economic
policies, including potential trade
agreement changes, are expected to
contribute to a strengthening economy
over the next couple of years, said John
T. Leonard, president and CEO at
MEMIC Group, a Portland, Maine-
based workers’ comp insurer.
“There will be an increase in
payroll associated with a growing
economy, particularly [in construction]
and payroll is the cornerstone of the
development of premium,” he said.
Yet, doubters suggest President
Trump’s actions could back;re.
I write my columns a few weeks
before publication and as I craft this
particular one, headlines suggest
Trump-inspired trade wars could slice
gross domestic product and harm
trade-dependent U.S. employment.
Even the optimists know headwinds
are always a threat.
We are in the midst of one of the
longest economic expansions since
World War II, increasing the historical
likelihood of a coming recession,
Weisbart said. But a recession could
get pushed farther out, should
Congress go along with the president’s
proposals, he said.
There is no shortage of oft-quoted
comments about the value of economic
predictions. Some point out that even
with hindsight, observers never agreed
on the Great Recession’s causes, let
alone its ferocity.
Perhaps, Yogi Berra said it best with
his simple quote, “It’s hard making
predictions, especially when they are
about the future.”
I don’t agree with a lot of President
Trump’s policies. But on this topic I
hope Weisbart and the optimists have
it right. Not many would disagree that
economic expansion is always more fun
than contraction. &
ROBERTO CENICEROS is senior editor at
Risk & Insurance® and chair of the National
Workers’ Compensation and Disability
Conference® & Expo. He can be reached at
BY ROBERTO CENICEROS