As the business landscape continues to evolve, particularly in anticipation of 2025, emerging trends surrounding employee benefits and artificial intelligence are garnering significant attention. Jon Cooper, CEO of Overalls, an employee benefits provider, has shared insights based on interactions with clients across various industries, including tech, professional services, healthcare, and manufacturing.
Cooper forecasts a fundamental shift in employee training, propelled by the adoption of artificial intelligence "copilots." These AI systems, designed to assist employees in navigating their tasks, will necessitate a continual process of reskilling. "Employees who are being reskilled now in a year will have to be re-reskilled because the tools will have evolved to become more sophisticated as well," he stated, indicating that departments focused on employee education and upskilling are likely to become core areas of investment as companies adapt to these technological advancements.
In the realm of healthcare benefits, Cooper anticipates that 2025 will see companies implement more aggressive strategies to manage costs, particularly in light of projected rises in healthcare plan renewal rates. He highlighted a concerning trend wherein employers are increasingly shifting the financial burden of healthcare onto employees. "There's been an increasing shift of just putting more and more of the cost on employees," he remarked. This shift may manifest in practices such as individual coverage health reimbursement arrangements (ICHRAs), where employees purchase their own health insurance and receive reimbursements from their employers. Additionally, the potential for reference-based pricing—where employers pay a predetermined price for healthcare services, leaving employees responsible for any additional costs—could further complicate the benefits landscape.
Cooper raised an important issue regarding the complexity of navigating such systems, stating that the combination of insurance products can become particularly burdensome for employees. "It's putting a lot of responsibility to navigate a very complex situation on consumers who in many cases are already dealing with an accident or a family member who's sick," he said.
In terms of benefits offerings, there appears to be a shift away from blanket wellness programs towards more personalised solutions. Cooper noted that employers are increasingly providing individual benefits budgets, allowing employees to allocate funds toward their personal needs, whether it be a gym membership or other health-related expenses. He also anticipates a greater emphasis on preventative measures, as companies seek to tackle employee life challenges before they escalate. According to a poll conducted by Overalls, a significant proportion of employees have reported lost work time due to personal struggles, which highlights the importance of proactive support systems.
Additionally, businesses are adapting their approach to disaster and business continuity planning. In the wake of extreme weather events in 2024, Cooper noted that an increasing number of companies are creating financial pools dedicated to assisting employees impacted by natural disasters. This shift underscores the growing recognition of the interplay between employee welfare and overall business resilience.
With a notable percentage of Overalls' clientele belonging to the tech and professional services sectors, Cooper predicts an uptick in tech hiring in 2025, as hiring freezes are lifted and capital becomes more accessible. He forecasted a return to hybrid work arrangements, as flexibility becomes a key recruitment strategy in attracting talent from major corporations. "The number one thing they're recruiting on—and how they're trying to attract people away from Google and Amazon—is that they offer completely flexible work," he explained.
Cooper believes that increasing competition for talent within the tech industry will lead to enhanced spending on employee benefits. "Companies are starting to say: 'OK, there is a path to raising more capital, a path to exiting. Therefore, we can start to spend more,'" he concluded, indicating a trend towards substantial investment in employee wellbeing as businesses adapt to new challenges and opportunities ahead.
Overall, the insights provided by Jon Cooper reflect an ongoing evolution in employee benefits, tied closely to advancements in technology and the pressing need for businesses to adapt to changing workforce expectations.
Source: Noah Wire Services