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A new report has highlighted that global businesses are opting to spend more on foundational benefits for workers – shifting away from wellbeing benefits.
Wellbeing benefits have mostly been a welcome inclusion across various industries; however, a recent report has shown that despite this fondness, employers are shifting away from wellness and embracing more foundational benefits.
According to the Ben Global State of Benefits Report 2025, spending on foundational benefits like medical and life insurance have seen increases of 105 per cent and 115 per cent, respectively, with wellbeing benefit spending falling 13 per cent since 2022, with a 10 per cent drop in 2024 alone.
Engagement from employees on these benefits was considered an issue throughout the report, as 63 per cent of global companies are focusing on increasing that engagement in the coming year, with 72 per cent stating that engagement was either “low” (21 per cent) or “average” (51 per cent).
The report noted that much of this disengagement comes from global benefits offerings being disjointed and not effectively communicating and tracking success with employees. Around 37 per cent of employer respondents communicate their benefits just once – while 70 per cent don’t have a unified benefits solution.
A lack of tracking of the ROI of these benefits is also a key issue, as the majority (62 per cent) fail to do so. This makes it extremely difficult to know what benefits resonate well with employees. Another hurdle for employers was the lack of offering benefit choices or flexibility to employees (49 per cent).
“This is an exciting time for benefits as companies refocus on what truly matters. In the face of economic uncertainty and tight labour markets, forward-thinking organisations are navigating the complexity of global benefits by harmonising and streamlining programmes,” said Sebastian Fallert, chief executive at Ben.
The report outlines three employee benefit predictions for 2025:
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Implementation of AI in benefit design and delivery: AI offers a solution to many of the challenges outlined in the report, by personalising benefits offerings at scale and ensuring relevance and appeal to diverse employee demographics.
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Legislative changes are highly likely to impact benefits budgets globally: Changes in UK employer National Insurance contributions could reshape benefits priorities.
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Employee demographic shifts: Aging workforces and workers having to balance eldercare and childcare needs will lead to more demand for benefits consultancy and design, a rise in interest for global minimum standards for core benefits, and a further decline of wellbeing-first benefits.
“Meanwhile, we’re seeing AI and data emerging as transformative tools, unlocking access to benefits of knowledge and empowering reward leaders to deliver highly impactful strategies,” said Fallert.
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Benefits include any additional incentives that encourage working a little bit more to obtain outcomes, foster a feeling of teamwork, or increase satisfaction at work. Small incentives may have a big impact on motivation. The advantages build on financial rewards to promote your business as a desirable employer.
Kace O'Neill
Kace O'Neill is a Graduate Journalist for HR Leader. Kace studied Media Communications and Maori studies at the University of Otago, he has a passion for sports and storytelling.
