As health premiums reach nearly $24,000 annually for family coverage, understanding the complex benefits landscape has never been more critical for employers and employees alike.
Key Takeaways
- In 2023, the average annual premium for employer-sponsored family health coverage reached $23,968, a 7% increase from 2022, according to the Kaiser Family Foundation Employer Health Benefits Survey.
- Workers contributed an average of $6,575 toward family health premiums in 2023, representing 29% of the total premium cost, per KFF data.
- 73% of large firms (200+ workers) offered Health Savings Accounts (HSAs) in 2023, up from 58% in 2019, as reported by KFF.
- In 2023, 68% of U.S. workers had access to employer-sponsored health insurance, stable from 2022, BLS data.
- Defined contribution plan participation reached 53% of private sector workers in 2022, per BLS National Compensation Survey.
- Average 401(k) account balance for workers aged 55-64 was $232,710 at year-end 2023, Vanguard How America Saves report.
- In 2023, private industry workers received paid sick leave from 79% of employers, averaging 7 days per year, BLS.
- Vacation leave was provided to 77% of private sector workers, averaging 14 days after one year of service, BLS 2023.
- Paid holidays averaged 8 days per year for 77% of private industry employees in 2023, per BLS.
- In 2023, 42% of employers offered student loan repayment assistance averaging $2,500/year, SHRM survey.
- Financial wellness programs were provided by 68% of organizations in 2023, up from 55% in 2021, per PwC.
- 55% of employers offered emergency savings accounts in 2023, averaging $1,000 match, Mercer.
- Total benefits costs averaged 30.8% of total compensation in 2023, BLS.
- Benefits as % of pay rose to 32% in private industry, 46% in state/local gov in 2023, BLS ECEC.
- 86% of U.S. employers offered benefits packages in 2023, up from 82% in 2020, SHRM.
Rising employer healthcare costs are driving expanded benefits offerings in 2023.
Financial Wellness
- In 2023, 42% of employers offered student loan repayment assistance averaging $2,500/year, SHRM survey.
- Financial wellness programs were provided by 68% of organizations in 2023, up from 55% in 2021, per PwC.
- 55% of employers offered emergency savings accounts in 2023, averaging $1,000 match, Mercer.
- Adoption of financial coaching services reached 51% among large firms in 2023, SHRM data.
- 29% of workers reported high financial stress in 2023, prompting 60% employer response, PwC.
- Tuition reimbursement averaged $5,250 per employee in 2023 for 52% of employers, SHRM.
- 401(k) advice services used by 45% of plans, improving outcomes by 1.5% returns, Fidelity 2023.
- Debt management programs offered by 35% of employers in 2023, focusing on credit counseling, Mercer.
- 48% of Gen Z workers prioritized financial benefits in 2023 job choices, Deloitte survey.
- HSAs grew to $28.7 billion in assets by end-2023, with 36 million accounts, EBRI.
- 67% of employers bundled financial wellness with EAP in 2023, PwC.
- Average student loan benefit was $100/month forgiveness for 20% of firms, SHRM 2023.
- Financial literacy training reached 62% participation via employer programs in 2023, Mercer.
- 25% offered buy-now-pay-later payroll integration in 2023, innovative trend per Deloitte.
- Wellness incentives tied to financial goals averaged $450 in 2023, SHRM.
- 71% of employers saw ROI on financial wellness programs via reduced turnover, PwC 2023.
- Pet insurance voluntary benefits enrolled 15% of eligible workers, averaging $20/month premium, SHRM.
- 33% provided identity theft protection in 2023, up 10%, Mercer data.
- Average commuter benefits subsidy was $1,200/year for 44% of urban employers, SHRM.
- Legal services plans covered 18% of large firms, averaging $1,500/year value, SHRM 2023.
- 52% offered childcare FSA up to $5,000 in 2023, BLS.
- Financial check-ups conducted for 40% of workforce via apps in 2023, Deloitte.
- 27% matched charitable donations up to $1,000/employee in 2023, SHRM.
- Dependent care benefits used by 28% of parents, saving $2,500 avg tax-free, BLS 2023.
- 61% of employers integrated AI financial tools in 2023 benefits platforms, Mercer.
- Average eldercare subsidy was $500/year for 12% of firms, SHRM.
Financial Wellness Interpretation
Employers are frantically assembling a financial safety net from tuition reimbursement to pet insurance, hoping it catches their stressed workforce before productivity plummets, yet the sheer variety of benefits highlights a desperate scramble to patch everything from student debt to eldercare in a system that remains, for many, a precarious tightrope.
Health Benefits
- In 2023, the average annual premium for employer-sponsored family health coverage reached $23,968, a 7% increase from 2022, according to the Kaiser Family Foundation Employer Health Benefits Survey.
- Workers contributed an average of $6,575 toward family health premiums in 2023, representing 29% of the total premium cost, per KFF data.
- 73% of large firms (200+ workers) offered Health Savings Accounts (HSAs) in 2023, up from 58% in 2019, as reported by KFF.
- Prescription drug costs accounted for 18% of total health plan spending in 2023, with employers facing 9% year-over-year increases, from Mercer’s National Survey of Employer-Sponsored Health Plans.
- In 2023, 92% of covered workers were in plans with deductibles averaging $1,735 for single coverage, a slight decrease from prior years, per KFF.
- 65% of employers offered telehealth services to at least some workers in 2023, with usage rates exceeding 40% post-pandemic, according to SHRM.
- Average out-of-pocket maximum for single coverage was $3,992 in 2023 for PPO plans, up 4% from 2022, from KFF survey.
- 24% of large employers self-funded at least some health benefits in 2023, rising to 81% among the largest firms, per KFF.
- Dental coverage was offered by 74% of small firms (3-199 workers) and 94% of large firms in 2023, KFF data shows.
- Vision benefits were provided by 54% of small firms and 79% of large firms in 2023, according to KFF Employer Health Benefits Survey.
- In 2022, employer health benefits costs grew by 5.1% to $13.4 trillion nationally, per PwC Medical Cost Trend Survey.
- 81% of employers with 500+ employees offered mental health benefits in 2023, up from 72% in 2021, Mercer reports.
- Average single coverage premium rose to $8,435 in 2023, with a 3% increase, from KFF annual survey.
- High-deductible health plans (HDHPs) covered 29% of workers in 2023, stable from previous years, per KFF.
- 50% of firms offered wellness programs tied to health benefits in 2023, with participation incentives averaging $600, SHRM data.
- Fertility benefits were offered by 39% of large employers in 2023, doubling from 2019, according to Mercer.
- Average employer contribution to single health premiums was $7,390 in 2023, per KFF.
- 67% of employers provided on-site or virtual health clinics in 2023, up significantly post-COVID, Mercer survey.
- Hearing benefits were offered by 22% of employers in 2023, a growing trend, from SHRM.
- In 2023, 45% of workers faced higher cost-sharing for specialty drugs, averaging $128 per fill, KFF reports.
- Medicare Advantage enrollment among employer-sponsored retirees reached 48% in 2023, per KFF.
- 88% of large firms offered retiree health benefits in some form in 2023, down slightly, KFF data.
- Average copay for primary care visits was $25 in 2023 for covered workers, stable per KFF.
- 62% of employers offered gender-affirming care coverage in 2023, up from 2022, Mercer.
- Health plan administrative costs averaged 5.5% of total premiums in 2023, from PwC.
- 76% of small firms offered health insurance in 2023, with average premiums lower than large firms, KFF.
- Virtual primary care was available to 75% of large employer workers in 2023, per Mercer.
- Average annual deductible for family coverage hit $3,591 in 2023, KFF survey.
- 34% of employers offered pet insurance as a voluntary health-related benefit in 2023, SHRM.
- Employer-sponsored health spending per capita grew 4.8% in 2023 to $14,270, per CMS data.
Health Benefits Interpretation
The relentless climb of health premiums now demands a king's ransom for family coverage, while workers dig deeper into their own pockets, employers scramble to offer a wider—yet often cost-shifting—array of benefits from HSAs to telehealth, and everyone nervously eyes the prescription bill, all in a frantic and expensive attempt to keep the system from crumbling under its own weight.
Paid Leave
- In 2023, private industry workers received paid sick leave from 79% of employers, averaging 7 days per year, BLS.
- Vacation leave was provided to 77% of private sector workers, averaging 14 days after one year of service, BLS 2023.
- Paid holidays averaged 8 days per year for 77% of private industry employees in 2023, per BLS.
- 27% of private employers offered paid family leave in 2023, up from 25% in 2022, BLS data.
- Average paid vacation after 5 years of service was 17 days for eligible workers, BLS National Compensation Survey 2023.
- Paid personal leave was available to 41% of workers, averaging 4 days, in 2023 BLS survey.
- 80% of state and local government workers had paid sick leave averaging 13 days in 2023, BLS.
- Under FMLA, 60% of eligible workers took leave in 2023, averaging 10 days unpaid, DOL survey.
- Paid parental leave was offered by 40% of employers for maternity (12 weeks average) in 2023, SHRM.
- 23% of private firms provided paid family leave averaging 7 weeks in 2023, BLS.
- Vacation accrual after 10 years averaged 18 days for 77% of workers, BLS 2023.
- Paid bereavement leave was offered by 49% of employers, averaging 3 days, SHRM 2023.
- 95% of union workers had paid holidays vs 75% non-union in 2023, BLS data.
- Average sick leave for service workers was 6 days, vs 10 for professionals in 2023, BLS.
- Paid jury duty leave covered 85% of employers, averaging full pay for 5 days, SHRM.
- 30% of small firms (50-99 workers) offered paid family leave in 2023, up 5%, BLS.
- Unlimited PTO policies were adopted by 24% of tech firms but only 3% overall in 2023, SHRM.
- Paid military leave was provided by 88% of employers, averaging 20 days pay, SHRM 2023.
- Vacation carryover allowed by 67% of employers, averaging 120 hours max, BLS.
- Paid sabbaticals offered by 15% of large firms (500+), averaging 4 weeks every 7 years, SHRM.
- 62% of workers used all accrued vacation in 2023, down from 70% pre-pandemic, SHRM.
- Paid civic duty leave (voting) at 72% of employers, full pay average, SHRM 2023.
- Sick leave payout upon termination offered by 27% of employers, averaging 50% accrual, BLS.
- Average paid holidays for professionals: 9 days, vs 6 for service in 2023, BLS.
- Paid caregiver leave piloted by 12% of Fortune 1000 in 2023, averaging 2 weeks, Mercer.
- 78% of employers with unlimited sick leave policies in 2023, mostly small firms, SHRM.
- Vacation after 20 years averaged 22 days for long-tenured staff, BLS 2023.
- Paid volunteer leave offered by 38% of employers, averaging 8 hours/year, SHRM.
Paid Leave Interpretation
The American workplace is slowly stitching together a basic safety net of time off, but the pattern remains wildly uneven, with benefits heavily dependent on your job, tenure, union status, and the generosity of your employer.
Retirement Benefits
- In 2023, 68% of U.S. workers had access to employer-sponsored health insurance, stable from 2022, BLS data.
- Defined contribution plan participation reached 53% of private sector workers in 2022, per BLS National Compensation Survey.
- Average 401(k) account balance for workers aged 55-64 was $232,710 at year-end 2023, Vanguard How America Saves report.
- 89% of Fortune 500 companies offered 401(k) matching contributions averaging 4.7% of salary in 2023, per Willis Towers Watson.
- Defined benefit pension plans covered only 15% of private industry workers in 2023, down from 35% in 1990, BLS.
- Average employer match for 401(k)s was 4.3% of pay in 2023 for firms offering it, EBRI data.
- 401(k) contribution limits rose to $22,500 in 2023 for under-50 workers, with catch-up at $7,500, IRS via EBRI.
- Auto-enrollment in 401(k) plans was used by 85% of large plans in 2023, boosting participation to 92%, Vanguard.
- Roth 401(k) options were available in 82% of plans in 2023, up from 73% in 2020, Vanguard.
- Average retirement account balance across all ages was $134,128 in Vanguard plans at end-2023.
- 49% of workers aged 25-34 participated in DC plans in 2023, per BLS.
- Employer contributions to DC plans averaged 4.6% of pay in 2023, Willis Towers Watson survey.
- Only 52% of private sector workers had access to retirement benefits in 2023, BLS data.
- Target-date funds held 48% of 401(k) assets in 2023, per ICI research.
- Average deferral rate for 401(k) participants was 7.4% in 2023, excluding matches, Vanguard.
- 401(k) loans were taken by 10% of participants in 2023, averaging $12,500, per EBRI.
- Cash balance plans covered 4% of private workers but held 20% of pension assets in 2023, BLS/ICI.
- Participation in retirement plans among state/local government workers was 90% in 2023, BLS.
- Average 401(k) balance for ages 65+ was $272,588 in 2023, Vanguard How America Saves.
- 75% of plans offered Roth provisions in 2023, up 10% from 2022, Fidelity data.
- Employer stock in 401(k)s averaged 5% of assets in plans offering it, 2023 Fidelity.
- Hardship withdrawals occurred in 2.1% of accounts in 2023, per EBRI.
- DC plan assets totaled $9.6 trillion in Q4 2023, Investment Company Institute.
- 83% of Vanguard 401(k) plans had automatic enrollment by 2023.
- Average match formula was 50% on first 6% deferred in 2023 plans, WTW.
- Only 30% of gig workers had retirement plan access in 2023, vs 53% traditional, BLS.
- Pension vesting averaged 5 years for cliff in DB plans, 2023 DOL data.
- 401(k) fees averaged 0.57% of assets in 2023, down from 0.93% in 2010, ICI.
- Women’s average 401(k) balance was 30% lower than men’s at $112,000 in 2023, Vanguard.
- 65% of employers offered financial wellness tools tied to retirement in 2023, SHRM.
Retirement Benefits Interpretation
The American workplace retirement system presents a paradox: despite widespread automation, generous matches, and rising account balances, it remains a rickety, patchwork ladder where too many are left clinging to the lower rungs or have no ladder at all.
Trends and Costs
- Total benefits costs averaged 30.8% of total compensation in 2023, BLS.
- Benefits as % of pay rose to 32% in private industry, 46% in state/local gov in 2023, BLS ECEC.
- 86% of U.S. employers offered benefits packages in 2023, up from 82% in 2020, SHRM.
- Turnover due to poor benefits cited by 41% of HR pros in 2023, Mercer survey.
- Benefits spending grew 3.2% in 2023, trailing wage growth of 4.1%, BLS.
- Gig economy benefits coverage at 12% in 2023, vs 68% traditional employees, BLS.
- DEI-linked benefits offered by 55% of large firms in 2023, Deloitte.
- Post-COVID, flexible benefits utilization hit 75% in 2023, PwC.
- SMBs (under 100 employees) cut benefits budgets by 2% in 2023 amid inflation, SHRM.
- ESG benefits integration at 28% of corporations in 2023, up 15%, Mercer.
- Remote work benefits (stipends) averaged $50/month for 60% of hybrid firms, SHRM 2023.
- Benefits satisfaction scored 4.1/5 in 2023, highest since 2019, Mercer.
- Voluntary benefits market grew 5.8% to $24 billion in premiums 2023, LIMRA.
- AI-driven personalization in benefits platforms adopted by 35% in 2023, Deloitte.
- Unionized firms offered 20% higher benefits value in 2023, BLS ECEC.
- Benefits cost per FTE rose to $13,090 in private sector 2023, BLS.
- 70% of Gen Z demanded mental health benefits in 2023 recruiting, SHRM.
- Healthcare cost containment strategies used by 92% of employers in 2023, KFF.
- Total rewards statements issued by 65% of firms, boosting perceived value 25%, Mercer 2023.
- Benefits outsourcing to PEOs grew 8% in 2023 for SMBs, NAPEO.
Trends and Costs Interpretation
While employers are racing to offer more expansive and personalized benefits to attract talent and appear competitive, the stark reality is that the actual investment in benefits is lagging behind wage growth and remains a critical, underfunded lever for retention, especially for smaller companies and gig workers.
Sources & References
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- Reference 7INSTITUTIONALinstitutional.vanguard.comVisit source
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