What are the trends in employee benefits to look out for in 2025

As workplaces continue to change, so do employee expectations for benefits. In 2025, companies will need to stay ahead of emerging trends to attract and retain top talent in a competitive job market. 

Traditional benefits like health insurance and retirement plans are no longer enough—employees are seeking more personalized, flexible options that address their unique needs and lifestyles. From innovative wellness initiatives to advancements in technology-driven solutions, the landscape of employee benefits is shifting rapidly. 

In this article, we will discuss the key trends in employee benefits that companies should watch out for in 2025 and how these trends can help create a more engaged, satisfied workforce.

Key takeaways

• Employees in 2025 prioritize personalized benefits like wellness stipends, career development, and flexible work arrangements over traditional offerings.
• Dependency care, remote work benefits, and mental health resources are key trends addressing modern workforce needs and expectations.
• Advancements in HR technology enable employers to personalize benefits, streamline administration, and enhance employee access to tailored resources.
• Flexible Spending Accounts (FSAs) and innovative wellness programs help employees manage expenses and foster holistic well-being.
• Partnering with flexible benefits platforms like Forma allows companies to offer diverse, cost-efficient, and impactful benefits programs. <span class="text-style-link text-color-blue" fs-mirrorclick-element="trigger" role="button">Schedule a demo with Forma today</span>

Why employee benefits are changing

It's important to understand the forces that are transforming the employee benefits landscape. Several key drivers are forcing companies to move away from typical table stakes benefits.

1. Changing workforce expectations

The workforce is becoming increasingly diverse, with a growing number of millennials and Gen Z employees entering the job market. These younger workers have different expectations and priorities regarding benefits.

They value flexibility, work-life balance, and personalized perks that align with their individual needs and values. Employers who want to attract and retain top talent will need to adapt their benefits offerings to meet these changing expectations.

2. Increased focus on employee wellbeing

In recent years, there has been a growing recognition of the importance of employee wellbeing and engagement. Employers are realizing that investing in their employees' physical, mental, and financial health can lead to improved productivity, reduced absenteeism, and higher retention rates.

As a result, more companies are offering comprehensive wellbeing programs that address all aspects of employee health and happiness.

3. Advancements in HR technology

Technology is transforming the way employers manage and deliver benefits. With the rise of AI, machine learning, and data analytics, HR teams can now personalize benefits offerings, streamline administration, and provide employees with easy access to information and resources.

For example, benefits administration platforms can help employees enroll in and manage their benefits online, while AI-powered tools can provide personalized recommendations and support. As technology continues to evolve, we can expect to see even more innovative solutions emerge in the coming years.

4. Emphasis on diversity, equity and inclusion

Diversity, equity, and inclusion (DEI) have become top priorities for many organizations in recent years. Employers are recognizing the importance of creating a diverse and inclusive workplace where all employees feel valued and supported.

This focus on DEI also shapes the future of employee benefits. Employers are looking for ways to offer benefits that support the unique needs of diverse employee populations, such as flexible work arrangements, inclusive health coverage, and employee resource groups. By prioritizing DEI in their benefits strategy, employers can create a more equitable and engaging workplace culture.

What types of employee wellness programs are trending?

As you look to the future of employee benefits, wellness programs are a key area to watch. Currently, the most successful wellness initiatives will take a holistic approach, addressing not just physical health but also mental, financial, and social well-being. Here are some of the top wellness trends to keep on your radar.

Dependency care

Dependency care benefits are becoming increasingly vital as employees balance professional responsibilities with caregiving duties. These benefits may include childcare stipends, eldercare support, access to dependent care flexible spending accounts, and caregiving resources.

• Why it benefits employees: Dependency care alleviates the financial and emotional burden of managing family responsibilities. Employees with access to these resources are better equipped to focus on their work without the stress of finding and funding adequate care for their dependents. This support fosters peace of mind and allows employees to be more productive and engaged.
• Why employees want it: With the rising costs of childcare and eldercare, employees are looking for employers who acknowledge and address these challenges. Dependency care benefits signal that the company values family life, creating a culture of empathy and support. Offering these resources also appeals to a multigenerational workforce, making the organization attractive to diverse talent.

Remote work

Ever since the pandemic, the demand for remote work has surged, with employees increasingly prioritizing flexibility in how and where they work. Employers are formalizing remote work benefits, such as home office stipends, internet reimbursements, and access to collaboration tools, to accommodate this shift.

• Why it benefits employees: Remote work enables employees to create a better work-life balance, avoid the stress of commuting, and work in an environment that suits their productivity. It offers flexibility for caregivers, parents, and those with unique lifestyle needs, fostering inclusivity.
• Why employees want it: Employees see remote work as a way to save time and money while enjoying the freedom to work from locations that fit their lives. It’s not just a perk—it’s a key driver of job satisfaction and loyalty in a competitive job market.

Flexible Spending Accounts (FSAs)

‍Flexible Spending Accounts allow employees to set aside pre-tax dollars for eligible expenses, such as healthcare, childcare, and commuting costs. Employers can offer FSAs as part of a comprehensive benefits package to enhance financial wellness for their workforce.

• Why it benefits employees: FSAs provide a way to manage expenses while reducing taxable income. Employees gain financial flexibility and can use pre-tax funds for essential costs, making it easier to budget for medical or childcare needs.
• Why employees want it: Rising healthcare and childcare costs make FSAs an attractive option for employees looking to stretch their dollars. The ability to plan for predictable expenses while saving money resonates with employees at all stages of life, from young professionals to those with families.

Mental health and wellness benefits

Mental health and wellness benefits are no longer optional—they are a critical part of any comprehensive benefits package. Employers are offering resources like virtual counseling, wellness apps, mental health days, and stress management programs to support their workforce.

• Why it benefits employees: These benefits provide employees with the tools to address stress, anxiety, and burnout, contributing to their overall well-being. When mental health is prioritized, employees feel valued and are better able to maintain focus and productivity.
• Why employees want it: Employees today expect companies to support their mental health as much as their physical health. Access to mental health resources reduces stigma and demonstrates that an organization is genuinely invested in its workforce’s holistic well-being.

Career development opportunities

Career development is a top priority for employees, with many seeking employers who actively invest in their growth. Programs like mentorship opportunities, tuition reimbursement, certifications, and training platforms empower employees to reach their professional goals.

• Why it benefits employees: Employees who have access to career development feel more motivated and confident in their roles. It gives them a sense of purpose and control over their career trajectory, which increases engagement and loyalty.
• Why employees want it: Growth opportunities are a deciding factor for employees evaluating job offers or deciding whether to stay with an organization. Employers that prioritize development signal a commitment to their team’s long-term success, making them a more attractive workplace.

Benefits of offering innovative and flexible employee benefits

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Offering innovative and flexible employee benefits isn't just a nice-to-have - it's a strategic imperative for any organization that wants to thrive in the competitive landscape. Here are some reasons why offering flexible employee benefits is a good idea in 2025.

Attract and retain top talent

In a tight labor market, top talent has their pick of employers. To stand out and win the war for talent, you need to offer benefits that go beyond the basics. Innovative perks like personalized wellness programs, flexible work arrangements, and professional development opportunities show candidates that you value their well-being and growth. 

Once you've hired the best and brightest, these benefits will help you keep them engaged, motivated, and loyal to your organization.

Boost employee satisfaction and productivity

When employees feel supported and cared for, they're more likely to be satisfied with their jobs and motivated to do their best work. Flexible benefits that cater to individual needs and preferences, such as mental health support or child care subsidies, can help reduce stress and distractions, allowing employees to focus on their work and be more productive. 

Plus, when employees have the freedom to choose the benefits that matter most to them, they feel a greater sense of control and ownership over their well-being, which can lead to higher job satisfaction and engagement.

Foster a positive employer brand

Your employee benefits package says a lot about your company culture and values. By offering innovative and inclusive benefits, you send a message that you care about your employees as whole people, not just as workers. This can help you build a positive employer brand and reputation, making it easier to attract and retain top talent. 

When your employees feel valued and supported, they're more likely to speak positively about your company to their networks, becoming brand ambassadors and helping you build a strong pipeline of qualified candidates.

Control rising healthcare costs

While offering comprehensive benefits may seem expensive, it can actually help you control costs in the long run. For example, by investing in preventive care and wellness programs, you can help employees stay healthy and catch potential health issues early, reducing the need for costly treatments down the line. 

By offering flexible benefits options like health savings accounts or telemedicine, you can give employees more control over their healthcare spending, encouraging them to be more cost-conscious consumers. Plus, when employees feel that their employer is invested in their well-being, they're more likely to stay with the company, reducing turnover costs and keeping your top talent on board.

How to create a competitive benefits package on a budget

Offering a competitive benefits package is key to attracting and retaining top talent, but it can be challenging to do so on a limited budget. However, with some strategic planning and creative thinking, you can design a benefits program that meets your employees' needs without breaking the bank.

Prioritize benefits that matter most to employees

The first step in creating a cost-effective benefits package is to understand what your employees value most. Conduct surveys, focus groups, or one-on-one interviews to gather feedback on which benefits are most important to your workforce. This will help you allocate your budget to the areas that will have the greatest impact on employee satisfaction and retention.

For example, if your employees prioritize work-life balance, you may want to invest in flexible work arrangements or paid time off. If health and wellness are top concerns, you may want to focus on comprehensive medical coverage or wellness programs.

Offer voluntary benefits at group rates

Voluntary benefits are a cost-effective way to expand your benefits offerings without adding to your bottom line. These benefits are available to employees at their own expense but at a discounted group rate negotiated by the employer.

Examples of voluntary benefits include:

• Supplemental life insurance
• Accident or critical illness insurance
• Pet insurance
• Identity theft protection
• Legal services

By offering these benefits at a group rate, you can provide value to your employees without increasing your benefits budget.

Implement cost-sharing strategies

Another way to manage benefits costs is to implement cost-sharing strategies that balance the financial responsibility between the employer and the employee. This can include:

• Offering high-deductible health plans paired with health savings accounts (HSAs)
• Implementing tiered copay structures for prescription drugs or medical services
• Offering a defined contribution model for health insurance, where employees receive a set amount to purchase their own coverage

These strategies can help you control costs while still providing comprehensive coverage options for your employees. Benefits administration platforms can also help you manage these cost-sharing arrangements and communicate them clearly to your workforce.

Promote preventive care and wellness to reduce claims

Finally, promoting preventive care and wellness can help you reduce healthcare claims and costs over time. When employees are healthier, they are less likely to need expensive medical treatment or miss work due to illness.

Consider offering benefits such as:

• Annual physicals and screenings covered at 100%
• Flu shot clinics and other immunizations
• Wellness programs that incentivize healthy behaviors
• Telemedicine services for convenient access to care
• Employee assistance programs (EAPs) for mental health support

By investing in preventive care and wellness, you can help your employees stay healthy and productive while managing your long-term healthcare costs. Benefits administration platforms can also help you track the ROI of these programs and make data-driven decisions about where to invest your resources.

Work with a third-party administrator (TPA)

Working with a flexible benefits provider is a smart choice for businesses looking to attract and retain top talent while reducing administrative burdens. These providers offer platforms that streamline the management of customizable benefits like Lifestyle Spending Accounts (LSAs), wellness stipends, and professional development funds. 

By partnering with a flexible benefits provider, businesses can easily adapt to employees' diverse needs, enhance satisfaction, and maintain compliance with tax and legal regulations. 

Additionally, traditional benefits often include fixed costs for services employees may never use, leading to wasted resources. Flexible benefits platforms address this by offering a pay-as-you-go model, where employers only fund benefits that employees actually use. For example, instead of pre-paying for blanket wellness programs or unused gym memberships, companies can allocate funds to Lifestyle Spending Accounts (LSAs) or stipends. These funds are only spent when employees redeem them, minimizing waste and optimizing budget allocation. 

Are flexible benefits platforms worth the investment?

Flexible benefits platforms are more than just a modern convenience—they are a strategic investment in your workforce and business success. By offering customizable benefits tailored to the diverse needs of employees, these platforms help boost engagement, satisfaction, and retention. Employees appreciate the flexibility to choose benefits that align with their personal and professional goals, fostering loyalty and productivity.

From a business perspective, flexible benefits platforms reduce administrative burdens, streamline program management, and provide data-driven insights to refine offerings. They also help cut costs by eliminating expenditure on unused benefits, ensuring companies only pay for what employees truly value.

Partnering with Forma, a leader in flexible benefits, ensures your benefits strategy delivers maximum impact. Forma offers cutting-edge solutions like Lifestyle Spending Accounts (LSAs), wellness stipends, and professional development funds, allowing you to meet the unique needs of your workforce. With Forma, businesses benefit from an intuitive platform that automates administration, simplifies compliance, and provides actionable analytics to continually improve offerings.

Trusted by industry leaders like lululemon, Microsoft, and TripAdvisor, Forma is designed to reduce complexity and enhance employee satisfaction. By partnering with Forma, your organization can stay competitive in attracting and retaining top talent while managing costs effectively.

Take the next step in revolutionizing your benefits program. <span class="text-style-link text-color-blue" fs-mirrorclick-element="trigger" role="button">Schedule a demo with Forma</span> today and see how we can help you create a benefits strategy that resonates with your team and drives long-term success.

*This document is for informational purposes. Forma is not engaged in the practice of law. Nothing contained herein is intended as tax or legal advice nor is it intended to replace tax or legal advice from counsel. If you need tax or legal advice, please consult with counsel or a certified tax professional.