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LIMRA-EY US research highlights how employers can deliver the value and flexibility a multi-generational workforce increasingly expects.
In brief
- Employers face rising costs, workforce diversity, and tech disruption, alongside new challenges like macroeconomic uncertainty and AI adoption.
- Benefits are crucial for attracting talent, with a shift towards innovative, personalized offerings, especially for younger workers, despite cost concerns.
- Brokers are evolving to provide strategic advisory services, but consolidation may stifle localized innovation, while AI offers opportunities for better engagement.
The LIMRA-EY 2025 Workforce Benefits Study highlights that employers of all shapes, sizes and sectors continue to face long-standing challenges related to rising medical costs, a diversifying workforce and technology-driven disruption. But new issues and opportunities — including the impact of macroeconomic uncertainty, increased adoption of artificial intelligence (AI) and the need for efficient administration of expanding leave management programs — have also emerged.
Overall, the findings of our latest biannual research show that benefits remain essential in the ongoing competition for talent and for offering a quality workplace experience for employees. Benefits portfolios are, however, rapidly evolving and expanding, a shift that highlights where yesterday’s leading practices must give way to more innovative techniques. With core benefits still as important as ever, nontraditional benefits are gaining traction in the market because they are particularly important to younger generations of workers. More options will likely be necessary in the future given that most benefits programs have been designed for boomers and Gen X, even though millennials and Gen Z now represent a larger proportion of the workforce.
This year’s key findings:
- Workplace benefits remain at the heart of the employee value proposition – and expectations continue to rise. Holistic solutions, curated benefits programs and AI tools for hyper-personalization will win the future.
- The generational tipping point has made wellness benefits a must-have. Gen Z and Millennials are now a larger proportion of the workforce. Lifestyle bundles and connected experiences are key to unlocking value and satisfying workers with diverse needs, particularly younger employees.
- Employer focus on economic value is driving fundamental changes in brokers’ roles. Brokers increasingly serve as strategic advisors and providers of data-driven insights. But talent availability is becoming a critical constraint. Additionally, ongoing consolidation may have unintended consequences, including less innovation and new competition for underserved segments.
- The market is ready for the next generation of absence/leave management services. The combination of expanding leave benefits with increasingly complex regulation, compliance challenges, process inefficiencies, and a lack of key capabilities create the potential for “absence and leave mismanagement.” There is, however, significant opportunity for reliable, scalable plug-and-play solutions.
- There’s no stopping the digital revolution – especially as AI gains traction and further evolves. Claims journeys are the top priority for further digitization. With AI still in exploratory mode, firms will take a “crawl-walk-run” approach.
Download the 2025 Workforce Benefits Study report to view the full findings.
The LIMRA-EY Wheel of Wellness
Focused on five key dimensions of health, the LIMRA-EY Wheel of Wellness, can help organizations build a happier, healthier, more productive, and financially secure workforce.
Summary
Benefits remain crucial for attracting talent, but portfolios are evolving, with non-traditional benefits gaining importance, especially among younger workers. While employers have expanded offerings, cost concerns and the need for personalized benefits pose challenges. The role of brokers is shifting towards strategic advisory services, but consolidation may hinder localized innovation. AI presents opportunities to enhance employee education and benefit utilization, making benefits more relevant to the workforce.
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