Staying Ahead of the Curve: 6 Employee Benefits Trends to Follow in 2023

The past few years have seen significant changes in the workplace, leading to a wide range of new challenges for organizations of all sizes. Many of these challenges will likely continue in 2023 and beyond. One of the most pressing challenges that employers are facing is the need to balance rising costs and inflation with the need to provide employees with benefits that they value and need. As the labor market continues to be tight, employers are facing increasing pressure to attract and retain top talent.

Recognizing and understanding key employee benefits trends can help your organization to assess whether your current benefit offerings meet the demands and needs of your employees while simultaneously setting your organization up for success.

In this article, we break down and discuss the six key employee benefits trends that will make a big impact on your organization this year.

1. Addressing Healthcare Costs

Finding ways to control rising healthcare costs while keeping benefits affordable is a critical challenge for employers in 2023. With many organizations' budgets likely to be limited due to the economic downturn and ongoing labor market issues, it will be important for employers to find ways to manage healthcare costs in order to maintain employee benefits and keep their business financially sustainable.

Planning and implementing multiple strategies to manage healthcare costs can help you develop cost-saving strategies, such as:

Modifying health plan designs
Implementing high-deductible health plans (HDHPs) or consumer-directed plans (CHDPs)
Improving employee healthcare literacy
Revisiting cost-sharing arrangements
Promoting telemedicine services included in existing health plans

Employers should carefully evaluate the different options available to them and implement the strategies that are most appropriate for their organization and employees. By taking a multi-faceted approach, employers can help to control rising healthcare costs while maintaining employee benefits.

2. Prioritizing Employee Well-being

Employee well-being is a priority for many employers in 2023. Most employees are experiencing elevated stress, burnout and poor mental health due to inflation, increased job duties, and the lingering effects of the pandemic. While many employers enhanced their mental health and well-being benefits to better support workers in response to the pandemic, more employers are expected to prioritize employee well-being in 2023.

Employee benefits, perks, and wellness programs are expected to become more holistic to address employee mental, physical, and financial well-being.

To this end, many organizations are planning to implement the following methods in 2023:

Expanding employee assistance programs: Employee assistance programs (EAPs) can be expanded to include additional resources and support for employees experiencing burnout or other well-being challenges. This may include providing counseling services, mental health support, or other resources that can help employees cope with stress and improve their overall well-being.
Offering online resources, classes, and articles: Employers can provide employees with access to a wide range of online resources, classes, and articles that can help them improve their well-being. This may include resources on stress management, nutrition, exercise, and mental health, as well as articles and videos on topics related to work-life balance and well-being.
On-demand manager training: Managers play a critical role in identifying and addressing employee well-being challenges. By providing managers with training on how to recognize and respond to employee behavioral issues, employers can help to ensure that employees receive the support they need to improve their well-being.
Steering employees to appropriate resources: Employers can help employees to access the resources they need to improve their well-being by providing them with information about available resources and connecting them with appropriate providers or support groups.

3. Paid Family Leave

Paid family leave is a benefit that allows employees to take time off from work to care for a new child or a family member with a serious health condition, while still receiving a portion of their regular pay. As the conversation around paid family leave continues to gain momentum, more companies are likely to offer paid family leave as a benefit in 2023.

Paid family leave can provide a number of benefits for both employees and employers. Some of the values of paid leave include:

Attracting and retaining top talent: Offering paid family leave can be a competitive advantage for companies, as it shows that they value their employees and are willing to invest in their well-being.
Reducing turnover: Paid family leave allows employees to take time off without the fear of losing their job or falling behind in their careers. This can help to reduce turnover, as employees are more likely to return to work after taking leave.
Improving employee productivity and engagement: Studies have shown that employees who are able to take paid family leave are less likely to experience burnout and are more likely to return to work with increased productivity and engagement.
Supporting mental and physical well-being: Paid family leave can provide employees with the time they need to care for themselves and their families, which can help to improve their overall well-being.
Improving gender pay gap and work-life balance: Paid family leave can help to reduce the gender pay gap by allowing women to take time off to care for new children without fear of losing their jobs or falling behind in their careers. Paid family leave can also help to improve work-life balance by allowing employees to take time off to care for their families without sacrificing their careers.

4. Expanding Voluntary Benefits

It’s no secret that many employees are currently experiencing financial strain due to inflation and the economic slowdown, which means providing valued benefits is even more important this year. In 2023, expanding voluntary benefits may be an effective way to offer benefits that help workers avoid financial setbacks and stretch their dollars without raising costs.

Voluntary benefits are unique in that they’re optional; employees can select the coverage that matters most to them. While dental and vision care continues to be standard voluntary benefits, nontraditional offerings are becoming increasingly popular.

Some of the most popular voluntary benefits include:

Supplemental life insurance: This type of insurance can provide additional coverage for employees and their families in the event of an untimely death.
Short-term disability insurance: This type of insurance can provide employees with income replacement if they are unable to work due to a disability.
Accident insurance: This type of insurance can provide employees with a cash benefit if they are injured in an accident.
Pet insurance: This type of insurance can provide coverage for the medical expenses of an employee's pet.
Identity theft protection: This type of benefit can provide employees with protection against identity theft, including credit monitoring and recovery services.
Legal services: This type of benefit can provide employees with access to legal services, such as legal advice and representation.
Critical illness insurance: This type of insurance can provide employees with a cash benefit if they are diagnosed with a critical illness, such as cancer or heart disease.
Long-term care insurance: This type of insurance can provide employees with coverage for the cost of long-term care, such as in-home care or assisted living.

One of the main reasons why voluntary benefits are becoming an important employee benefits trend in 2023 is because they allow employees to tailor their benefits package to their individual needs and preferences. This can be particularly beneficial for employees who may not be able to take advantage of traditional employer-provided benefits, such as those who are part-time or contract employees.

5. Financial Wellness

With the economic uncertainty caused by the pandemic, many employers are expected to offer financial wellness programs to help employees manage their finances and reduce financial stress. According to a study by the Employee Benefit Research Institute, more than half of workers are stressed about their financial situation, and many employers see financial wellness programs as a way to help employees manage that stress.

Some of the key financial wellness benefits include:

Improved financial security: Financial wellness benefits can help employees to improve their financial security by providing them with the resources and tools they need to manage their finances and plan for their future.
Reduced financial stress: Financial wellness benefits can help to reduce financial stress by providing employees with the information and resources they need to make informed financial decisions.
Increased employee satisfaction: Financial wellness benefits can increase employee satisfaction by providing employees with the resources and tools they need to manage their finances and plan for their future, which can help to improve their overall well-being.
Increased savings and investment: Financial wellness benefits can also increase employees' savings and investments by providing them with the tools and resources to manage their finances and plan for their retirement.
Better financial decision-making: Financial wellness benefits can help employees to make better financial decisions by providing them with the information and resources they need to make informed financial decisions.

6. Continuing Flexible Work Arrangements

Finding work-life balance is one of the most effective ways to improve employee mental health and well-being. With the shift of remote working during the pandemic, employers are starting to offer more benefits to support their remote workers, such as home office setups, technology support, and remote working stipends. According to a report by the Society for Human Resource Management (SHRM), 48% of organizations currently have at least some employees working remotely, and many are starting to offer additional benefits to support remote workers.

Some of the benefits of flexible work arrangements include:

Increased productivity: Remote working can increase productivity by allowing employees to work in an environment that is most conducive to their productivity.
Reduced absenteeism: Remote working can reduce absenteeism by allowing employees to work from home when they are sick, which can help to reduce the spread of illness in the workplace.
Increased job satisfaction: Remote working can increase job satisfaction by allowing employees to have a better work-life balance and more control over their work schedule.
Reduced stress: Remote working can reduce stress by eliminating the need for a daily commute and allowing employees to work in an environment that is most comfortable for them.
Increased flexibility: Remote working can increase flexibility by allowing employees to work from anywhere and at any time, which can help to accommodate employees with varying personal and professional responsibilities.
Increased employee retention: Remote working can increase employee retention by allowing employees to have a better work-life balance and by making it easier for employees to stay with the company long-term.
Access to a wider talent pool: Remote working can also allow employers to access a wider talent pool and hire employees from different locations, which can help to diversify the workforce.

Summary

As your business navigates the challenges of rising healthcare costs and the need to maintain employee benefits, it is important to stay informed about current benefits trends and how they can impact both the success of your business and your employees. By being aware of these trends, you can develop strategies that are tailored to the unique needs of the workplace and workforce. While each workplace will have its own unique set of challenges and opportunities, recognizing current benefits trends can provide guidance for your organization as you strategize and take action.