# Macro Trends Revolutionizing Employee Benefits in 2023
Uncertainty “looms” large over the American workplace today, according to analysts at Marsh McLennan Agency in their annual Employee Health & Benefits Trends report. From political shifts to economic fluctuations and environmental concerns, employers face “daunting challenges” keeping pace with large-scale changes that are driving new trends in employee benefits.
However, these challenges bring opportunities for innovation. As Marsh McLennan experts note, responding strategically to these shifts can drive significant business growth.
## Four Major Trends Reshaping Benefits Packages
Marsh McLennan identified four key trends having outsized impacts on HR and benefits. Understanding these trends can help recruitment professionals guide clients toward more competitive benefits strategies.
## 1. Bridging the Multi-Generational Workplace Gap
Today’s workplace spans five generations, making “multi-decade age gaps between employees increasingly common.” This diversity requires thoughtful benefits design strategies with **flexibility at the core**.
Kate Moher, president of National Employee Health & Benefits at Marsh McLennan Agency, emphasizes that HR leaders must understand how each generation engages with:
– Benefits packages
– Career growth opportunities
– Workplace culture
This understanding builds trust and improves retention across all age groups. For example:
– Baby Boomers often prefer comprehensive, detailed benefits information
– Gen Z gravitates toward digital, on-demand content
– Millennials may prioritize work-life balance benefits
– Gen X might focus on retirement planning options
**Recruitment insight**: When placing candidates, consider how a company’s benefits communication style might appeal to different generations. A tech startup using only TikTok videos for benefits education might alienate older candidates, while paper-only materials could frustrate younger talent.
Rather than seeing generational differences as divisive, smart organizations use them as growth opportunities. Cross-generational **mentorship programs** allow knowledge sharing that benefits the entire workforce.
## 2. The AI Revolution in HR and Benefits
Artificial intelligence is transforming enterprises broadly, with HR experiencing particularly dramatic changes. Amy Letke, national HR consulting practice leader at Marsh McLennan, explains that embracing AI isn’t just about automation—”it’s about unlocking the potential of our greatest asset—people.”
The future of benefits administration includes:
– **Data-driven insights** that deepen employer-employee connections
– Enhanced employee experience through personalization
– Continuous growth cultures supported by AI tools
The key is maintaining a strong connection to **human empathy** while leveraging technological advancement. AI should complement rather than replace the human elements of HR.
**Recruitment insight**: When evaluating employer clients, assess their AI implementation in benefits. Companies using AI solely to cut costs may struggle with employee satisfaction compared to those using it to create more personalized experiences.
## 3. Tackling Rising Healthcare Costs
Healthcare costs are projected to increase 5.8% this year—the third consecutive year of record increases. Dr. Monte Masten, chief medical officer at Marsh McLennan Agency, emphasizes that addressing these rising costs requires “truly understanding what is driving the usage of care.”
This understanding starts and ends with **data analysis** of:
– Employee population demographics
– Prevalent chronic health conditions
– Social determinants of health
For example, a retailer facing high mental health costs should examine:
– Which employee populations drive the majority of costs
– Work location patterns and their impact
– Tenure correlations with mental health issues
– Generational differences in mental health needs
– Social factors like pay inequality or care access
– Quality of primary physician relationships
“Letting your detailed and granular data drive the development of targeted programs and communications is the key to mitigating high health care costs,” notes Masten.
**Recruitment insight**: When discussing benefits packages with clients, emphasize the value of targeted health programs over one-size-fits-all approaches. Companies that understand their workforce’s specific health needs often create more cost-effective benefits.
## 4. Navigating Pharmacy Benefit Management Changes
Rising pharmacy costs represent a significant portion of healthcare spending increases. Rick Kelly, national pharmacy practice leader at Marsh McLennan Agency, points to “long-standing opaque pricing” from Pharmacy Benefits Managers (PBMs) as a key challenge.
Recent Federal Trade Commission reports have highlighted PBM pricing issues, which have also been identified as targets for reform by the current administration.
As regulatory dynamics shift, employers should consider:
– Evaluating alternative PBM relationships
– Adjusting formularies to optimize costs
– Partnering with third parties on targeted cost-cutting initiatives
– Re-examining overall benefits philosophy, particularly regarding:
– Weight loss GLP-1 medications
– High-cost gene therapy treatments
– Pharmacy plan employer/member cost ratios
**Recruitment insight**: When advising clients on benefits packages, highlight the importance of pharmacy benefit strategy as a differentiator in talent acquisition. Companies with transparent, employee-friendly pharmacy benefits often have advantages in competitive hiring markets.
## Key Takeaways for Recruitment Professionals
1. **Flexibility is essential** in benefits design to accommodate five generations in the workplace. Help clients develop adaptable packages with strong communication strategies.
2. **AI implementation** in benefits should enhance human connections, not just automate processes. Look for employers balancing technology with empathy.
3. **Data-driven health strategies** produce better outcomes than generic approaches. Encourage clients to analyze their specific workforce health needs.
4. **Pharmacy benefit transparency** is becoming a competitive advantage. Guide clients toward more strategic PBM relationships.
5. **Innovation opportunities** exist within each challenge. The organizations that adapt most effectively to these trends will gain significant recruiting advantages.
These macro trends require recruiting professionals to stay informed and help clients navigate complexity. By understanding these forces shaping the benefits landscape, you’ll provide more strategic talent acquisition guidance.
# Macro Trends Revolutionizing Employee Benefits in 2023
Uncertainty “looms” large over the American workplace today, according to analysts at Marsh McLennan Agency in their annual Employee Health & Benefits Trends report. From political shifts to economic fluctuations and environmental concerns, employers face “daunting challenges” keeping pace with large-scale changes that are driving new trends in employee benefits.
However, these challenges bring opportunities for innovation. As Marsh McLennan experts note, responding strategically to these shifts can drive significant business growth.
## Four Major Trends Reshaping Benefits Packages
Marsh McLennan identified four key trends having outsized impacts on HR and benefits. Understanding these trends can help recruitment professionals guide clients toward more competitive benefits strategies.
## 1. Bridging the Multi-Generational Workplace Gap
Today’s workplace spans five generations, making “multi-decade age gaps between employees increasingly common.” This diversity requires thoughtful benefits design strategies with **flexibility at the core**.
Kate Moher, president of National Employee Health & Benefits at Marsh McLennan Agency, emphasizes that HR leaders must understand how each generation engages with:
– Benefits packages
– Career growth opportunities
– Workplace culture
This understanding builds trust and improves retention across all age groups. For example:
– Baby Boomers often prefer comprehensive, detailed benefits information
– Gen Z gravitates toward digital, on-demand content
– Millennials may prioritize work-life balance benefits
– Gen X might focus on retirement planning options
**Recruitment insight**: When placing candidates, consider how a company’s benefits communication style might appeal to different generations. A tech startup using only TikTok videos for benefits education might alienate older candidates, while paper-only materials could frustrate younger talent.
Rather than seeing generational differences as divisive, smart organizations use them as growth opportunities. Cross-generational **mentorship programs** allow knowledge sharing that benefits the entire workforce.
## 2. The AI Revolution in HR and Benefits
Artificial intelligence is transforming enterprises broadly, with HR experiencing particularly dramatic changes. Amy Letke, national HR consulting practice leader at Marsh McLennan, explains that embracing AI isn’t just about automation—”it’s about unlocking the potential of our greatest asset—people.”
The future of benefits administration includes:
– **Data-driven insights** that deepen employer-employee connections
– Enhanced employee experience through personalization
– Continuous growth cultures supported by AI tools
The key is maintaining a strong connection to **human empathy** while leveraging technological advancement. AI should complement rather than replace the human elements of HR.
**Recruitment insight**: When evaluating employer clients, assess their AI implementation in benefits. Companies using AI solely to cut costs may struggle with employee satisfaction compared to those using it to create more personalized experiences.
## 3. Tackling Rising Healthcare Costs
Healthcare costs are projected to increase 5.8% this year—the third consecutive year of record increases. Dr. Monte Masten, chief medical officer at Marsh McLennan Agency, emphasizes that addressing these rising costs requires “truly understanding what is driving the usage of care.”
This understanding starts and ends with **data analysis** of:
– Employee population demographics
– Prevalent chronic health conditions
– Social determinants of health
For example, a retailer facing high mental health costs should examine:
– Which employee populations drive the majority of costs
– Work location patterns and their impact
– Tenure correlations with mental health issues
– Generational differences in mental health needs
– Social factors like pay inequality or care access
– Quality of primary physician relationships
“Letting your detailed and granular data drive the development of targeted programs and communications is the key to mitigating high health care costs,” notes Masten.
**Recruitment insight**: When discussing benefits packages with clients, emphasize the value of targeted health programs over one-size-fits-all approaches. Companies that understand their workforce’s specific health needs often create more cost-effective benefits.
## 4. Navigating Pharmacy Benefit Management Changes
Rising pharmacy costs represent a significant portion of healthcare spending increases. Rick Kelly, national pharmacy practice leader at Marsh McLennan Agency, points to “long-standing opaque pricing” from Pharmacy Benefits Managers (PBMs) as a key challenge.
Recent Federal Trade Commission reports have highlighted PBM pricing issues, which have also been identified as targets for reform by the current administration.
As regulatory dynamics shift, employers should consider:
– Evaluating alternative PBM relationships
– Adjusting formularies to optimize costs
– Partnering with third parties on targeted cost-cutting initiatives
– Re-examining overall benefits philosophy, particularly regarding:
– Weight loss GLP-1 medications
– High-cost gene therapy treatments
– Pharmacy plan employer/member cost ratios
**Recruitment insight**: When advising clients on benefits packages, highlight the importance of pharmacy benefit strategy as a differentiator in talent acquisition. Companies with transparent, employee-friendly pharmacy benefits often have advantages in competitive hiring markets.
## Key Takeaways for Recruitment Professionals
1. **Flexibility is essential** in benefits design to accommodate five generations in the workplace. Help clients develop adaptable packages with strong communication strategies.
2. **AI implementation** in benefits should enhance human connections, not just automate processes. Look for employers balancing technology with empathy.
3. **Data-driven health strategies** produce better outcomes than generic approaches. Encourage clients to analyze their specific workforce health needs.
4. **Pharmacy benefit transparency** is becoming a competitive advantage. Guide clients toward more strategic PBM relationships.
5. **Innovation opportunities** exist within each challenge. The organizations that adapt most effectively to these trends will gain significant recruiting advantages.
These macro trends require recruiting professionals to stay informed and help clients navigate complexity. By understanding these forces shaping the benefits landscape, you’ll provide more strategic talent acquisition guidance.