ANSWER: Yes. PeopleImport will not parse the single column of data. This will need to be done prior to importing. Then map to the appropriate separate fields in Salesforce. Having these in separate fields also allows first and last names to be matched on separately, e.g. email and last name only. Also, since first name can be mapped separately from last name, mapping options like "FirstName" match and "First XX Letters" can be used.
PeopleImport FAQs