As employers look ahead to 2024, the labor market doesn’t appear to be easing much, meaning talent acquisition and retention won’t get any easier for HR leaders. However, experts say that traditional and newer benefits can play a critical role in helping attract and retain top candidates and employees.
From mental health and financial wellness to covering menopause benefits and weight loss drugs, both familiar and emerging benefits will remain critical to HR strategy, says Julie Stich, vice president of content at the International Foundation of Employee Benefit Plans.
“If you’ve got people who are productive and they’re skilled and bring the skills you need and want, you’ll want to keep them—and benefits is one way to do that,” Stich tells HRE.
Here are eight benefits trends to watch in the year ahead.
An increasing number of employers are considering adding menopause benefits to their offerings, Stich says. With 75% of American women in their 40s and 50s working, the sometimes debilitating impact of menopause—including such symptoms as brain fog, low energy, sleep disruption and hot flashes—likely affects most workplaces in the United States.
Currently, only 4% of U.S. employers offer menopause accommodations, but that figure is expected to soar to 33% within the next five years, according to benefits consultant NFP. More employees are seeking support, Stich says, for benefits that can include a quiet room to rest, a desk fan, flexible schedules or paid time off.
Software giant Microsoft and biotech titan Genentech are among the industry stalwarts already offering menopause benefits.
Weight loss drug coverage
Ozempic and similar drugs prescribed for weight loss have been a hot topic with employers all year and likely will remain that way in 2024, says Stich.
“The cost is not cheap for this particular coverage, but employers are comparing that with some of the comorbidities tied to obesity like hypertension, heart disease and some type 2 diabetes,” Stich says. “They’re also considering the demand that they’re hearing from their employees who want access to these drugs.”
Forty-nine percent of large employers expect to cover the GLP semaglutide weight loss medications as part of their 2024 health plans, up from 46% in 2023, according to a recent survey by the Business Group on Health.
Personalized benefits, specifically voluntary benefits and lifestyle spending accounts, are on the rise as employers seek to connect with employees who “want to feel they belong and are valued,” Stich says.
Voluntary benefits include pet insurance and access to legal services, for example. Demand for both has soared in recent years.
With newer lifestyle savings accounts, which are employer-funded, employees can tap into the account to purchase a variety of items or services that employers deem eligible, such as athletic shoes or sessions with a debt management consultant. Currently offered by about 13% of employers, LSAs are being considered as additions by 70% of employers, according to a recent Mercer blog post.
Precision medicine, also known as personalized care, is increasing as employees and their providers seek better and more detailed information for anticipating and treating a variety of illnesses. A survey from the Business Group on Health shows that 44% of employers plan to offer some form of precision medicine coverage in 2024.
For example, 31% of employers will cover genomic tests to find the best cancer treatment for an individual patient, says Brenna Shebel, vice president at the Business Group on Health.
Many employees are seeking assistance caring for children, parents and, in some cases, grandparents, Stich says. This support ranges from flexible work options to paid time off and access to emergency caregiving services.
Child and elder care benefits soared 177% from 2020 to 2023, according to a Goldman Sachs report, and are expected to continue to rise.
“Caregiving is an area that’s been discussed quite a bit and will continue to be discussed into 2024,” says Stich.
Across the globe, about one in six people are infertile, according to a World Health Organization report, a fact that can significantly affect workforce productivity. A survey by fertility care company Carrot found that nearly three-quarters (74%) of affected employees have researched the condition and treatment while at work, and even more (77%) indicate they would stay at their employer longer if they offered support for fertility treatments.
Stich says employers are responding, increasingly offering fertility and surrogacy benefits and adoption assistance. Other related benefits also are on the rise, she says, including access to lactation consulting services and products and egg harvesting and freezing.
Mental health benefits
Since spiking early in the COVID pandemic, demand for mental health services has not abated and instead continues to rise, Stich says. For instance, 83% of therapists surveyed by Grow Therapy said the number of patients seeking help for the first time increased this year.
As a result, 63% of employers are focusing on enhancing mental health and emotional wellbeing programs in 2024, according to WTW’s 2023 Best Practices in Healthcare Survey.
While employers are signaling they will enhance their mental health benefits, Stich says, they will have to contend with challenges. For instance, she says, there are “not enough providers in the mental health world,” and employees continue to struggle to get timely access to care when they need it.
Financial wellness benefits
Amid persistent inflation and recession worries, financial wellness benefits will loom large in 2024.
For the first time, employers’ greatest financial wellness worry for their employees is the rising cost of living, according to EBRI’s Financial Wellbeing Employer Survey. That’s up from No. 4 last year and may prompt many employers to offer a wide array of benefits, from emergency savings accounts to funds to help repay student loans, Stich says.
“Inflation is having an impact on employees,” she says, “and employers are responding.”