2023 Midyear Benefits Trends
July 26, 2023
2023 Midyear Benefits Trends

Heading into the latter half of 2023, there are several benefits trends impacting employers. While some of these trends are new, many are not, and employers have been trying to address many of the same benefits challenges for the last few years. Some employers have responded to these challenges by attempting to meet employee demands, such as offering competitive benefits or flexible work arrangements, but by and large, most employers are currently struggling to find adequate solutions. These challenges are likely to continue through the remainder of 2023. However, understanding the latest benefits trends can help employers evaluate their offerings to best meet employee needs, respond successfully to their challenges and give them an advantage over their competitors. Proactively reacting to these trends can help keep employees happy, healthy and loyal.


This article explores benefits trends to watch in the second half of 2023, discussing how they will likely impact employers and offering strategies to address them.


Employers Struggle to Mitigate Rising Health Care Costs

Finding ways to reign in rising health care costs while keeping benefits affordable is critical for employers during the second half of 2023; however, this won’t be easy. Health care costs have risen sharply over the last few years and will likely continue to rise. While average costs increased by 3.2% in 2022, employers expect an increase of 5.4% in 2023, according to a Mercer survey. What’s worse, many employers feel they’re running out of cost containment strategies to combat increasing costs.


Zywave’s 2023 Broker Services Survey found that employers seem to be frustrated by the limited options to address their rising health care costs. Many feel they’ve exhausted traditional approaches to health care cost mitigation, such as guiding employees to cost-effective care, improving health care literacy and leveraging technology. As a result, unless employers are willing to take more drastic measures, such as modifying health plan designs or funding, there may be little they can do to mitigate such rising costs. Compounding concerns, if a recession arrives during the second half of the year, as many economists predict, addressing health care costs will likely become even more challenging for employers.


Employers also revealed in the 2023 Broker Services Survey that they are uncertain whether their current plan design provides the best value as they try to mitigate health care costs. This uncertainty likely stems from employers feeling they have limited options to alleviate such costs, especially since established mechanisms that have helped reduce health care costs seem less effective. As a result, employers may need to implement significant changes to mitigate rising health care costs; however, many organizations will likely find altering health plan funding or design unpalatable because of the substantial risk of making mistakes and uncertainty, especially as the U.S. economy is in flux.


Despite these challenges, many employers will likely find it difficult to reduce or eliminate benefits due to a surprisingly strong labor market and employee expectations. While health care costs are not likely to decline any time soon, planning and implementing proactive strategies to minimize the impact of rising costs will likely have the largest impact.


AI Aims to Improve Benefits Administration

In 2023, artificial intelligence (AI) has made its way into many workplaces nationwide and is revolutionizing how organizations operate and make decisions. Employers are searching for ways to leverage this technology’s ability to create efficiencies, enhance workflows, streamline operations and improve customer experience. This technology has the potential to help employers streamline employee benefits administration, thus reducing costs, increasing accuracy and improving compliance. AI can improve and enhance employers’ benefits administration by: 


  • Streamlining benefits administration—AI can help automate manual, repetitive tasks, such as open enrollment, eligibility verification, claims processing and plan design. By automating these tasks, organizations can reduce their administrative burdens and improve accuracy.
  • Boosting employee self-service—AI chatbots can support employees by answering benefits-related questions, guiding them through enrollment and resolving potential issues. Utilizing AI technology can improve benefits accessibility and help employees to better manage their benefits on their own.
  • Personalizing benefits offerings—Employers can tailor their offerings to meet employee needs and preferences with the help of AI. These systems can sift through large amounts of data, such as demographic information, employee health records and health care utilization, to better personalize an organization’s benefits offerings.
  • Providing decision support—AI tools can empower employees to make informed benefits-related decisions by analyzing individual health and utilization data and providing tailored recommendations.
  • Improving compliance and risk management—Complying with benefits requirements and regulations can be challenging and often creates large administrative burdens for organizations as they try to stay informed and up to date on any changes. AI technology can monitor legislative changes and automate compliance updates in an organization’s benefits administration systems.
  • Delivering predictive analytics and cost optimization—AI tools can also help organizations forecast future benefits trends and needs by analyzing market data and historical trends. This can enable employers to make more informed decisions regarding plan designs and modifications, adjust benefits offerings to better suit employee needs and negotiate better rates. 


While many employers have embraced AI technology to aid in benefits administration, more employers are expected to follow suit in the second half of 2023 and beyond. However, employers must proceed with caution when implementing AI tools because these systems’ capabilities are limited by the information used to train them. Additionally, these tools may inadvertently reveal employee health information or make decisions that lead to biased or discriminatory outcomes. AI-generated errors like these can be costly, subjecting organizations to government audits, fines and penalties. Understanding how this technology works and ensuring human oversight can help organizations anticipate and address potential issues before they become problems.


Because AI technology in the workplace is still largely unregulated, there are many gray areas employers must navigate. Laws and regulations haven’t kept up with employers’ acceptance and incorporation of this technology. While many existing laws address AI-related issues, as a whole, such technology is a relatively new legal area. There’s currently a patchwork of federal and state regulations that address aspects of using AI tools in the employment context and benefits administration; however, legal issues related to these tools will likely continue to emerge as AI technology develops and becomes more advanced. Therefore, employers should stay current on all applicable laws and regulations impacting AI systems. Employers should consider establishing governance policies and procedures to evaluate and monitor AI tools as well as assess their long-term impacts. This can help ensure that organizations use AI tools responsibly and integrate such technology to complement human activity in the workplace in 2023 and beyond.


Pay Transparency Becomes the New Norm

Despite many employers’ reluctance to embrace pay transparency—because it can reveal unintended pay gaps and trigger questions from current employees— the practice is expected to become the norm in 2023. At the start of 2023, a fifth of all U.S. workers were covered by pay transparency laws. In 2021, Colorado was the first jurisdiction to enact such laws. Since then, many states and localities have enacted their own pay transparency laws, including:


  • California
  • Cincinnati, Ohio
  • Connecticut
  • Ithaca, New York
  • Jersey City, New Jersey
  • Maryland
  • Nevada
  • New York City
  • Rhode Island
  • Toledo, Ohio
  • Washington
  • Westchester County, New York


Even if employers are currently unaffected by pay transparency mandates, they should consider developing strategies to address this issue since pay transparency likely already impacts them directly or indirectly. Employers can protect themselves and help ensure compliance with applicable laws by understanding applicable pay transparency requirements and regularly reviewing job postings.


Pay transparency laws present distinct compliance challenges for employers subject to them since they vary depending on the state or locality. Employer compliance difficulties are often greater for organizations that recruit and hire employees across state lines. This has been further complicated by the general acceptance of remote work. Hiring remote workers can trigger legal obligations and create potential risks even in states where employers do not have a physical presence. To limit potential compliance issues, some employers may avoid hiring remote workers or workers who reside in states with pay transparency laws; however, this is likely an unsustainable strategy for employers, as it can drastically limit their recruiting pool. In contrast, some employers are ensuring their job postings comply with the strictest pay transparency requirements. This can include revamping hiring and recruitment practices to comply with pay transparency requirements, standardizing job postings to include salary ranges and benefits information, or tailoring job postings for states and localities with pay transparency laws.


Not only are more states and localities implementing pay transparency laws, but pay transparency is also becoming more important to workers. Employees overwhelmingly support pay transparency because it can help them to avoid applying for jobs they wouldn’t accept due to low pay, negotiate for better salaries and build trust with their employers. It also helps hold employers accountable for providing similar wages for similar roles. According to recent data from global employment website Monster, 98% of employees said employers should disclose pay ranges in job postings, with more than half saying they’d refuse to apply for jobs that do not disclose pay ranges, even in states where pay transparency isn’t legally required. Since applicants and employees value pay transparency, employers can benefit from providing pay-related information even when not required to do so; those who offer pay transparency tend to receive more applicants and save time and money in recruitment efforts by ensuring candidates don’t reject job offers due to insufficient pay.


Paid Leave Laws Are Impacting More Employers

Several employers expanded their leave policies in response to the COVID-19 pandemic, including increasing paid leave; however, in 2022, many organizations reversed course and reduced leave benefits to pre-pandemic levels. Despite this, many states have enacted laws to provide paid family and medical leave, and more are expected to do so in the near future. Currently, 11 states and the District of Columbia have state-run, mandatory paid family and medical leave programs that cover most private sector employees. Some of these laws have or will become effective in 2023. Other states, including New Hampshire and Vermont, have enacted voluntary paid leave laws. As a result, paid leave laws will soon impact more employers. Therefore, employers who are or will soon be subject to paid leave laws should ensure their workplace policies are compliant with 2023 requirements.


For employers not subject to paid leave requirements, now is a critical time for employers to consider their leave policies. Providing employees with paid leave is an effective way to support employee well-being and strengthen their attraction and retention efforts. Paid leave can include:


  • Medical leave, covering a worker’s own serious health condition
  • Parental leave, covering bonding with a new child (may also be referred to as maternity leave, paternity leave or bonding leave)
  • Caregiving leave, covering caring for a loved one with a serious health condition
  • Deployment-related leave, covering needs in connection with a loved one’s current or impending active duty military service
  • Safe leave, covering needs when a worker or their loved one is a victim of sexual or domestic violence


Expanding paid leave benefits can be an important talent acquisition strategy for employers since candidates and employees prioritize these benefits. These benefits can provide employees with an important safety net and peace of mind, helping build trust and increase loyalty.


The Battle Over Remote and Hybrid Work Continues

Remote and hybrid work arrangements were widely embraced by employers and employees at the outset of the COVID-19 pandemic. As lockdown orders lifted, many employers continued to offer these flexible work arrangements for various reasons, including acquiescing to employee demands during a tight labor market. Although remote and hybrid work is expected to continue to play an integral role in the work landscape, 2023 has seen some significant changes to these arrangements. These changes will likely continue to change and evolve throughout the remainder of the year.


Employers are concerned that remote and hybrid work arrangements have led to a drop in employee production. 


According to a Microsoft survey, 85% of leaders believe hybrid work has made it difficult to be confident that employees are productive, despite 87% of employees reporting they are productive at work; only 12% of senior leaders have full confidence their employees are productive.


Many employers believe that having employees return to in-office work will boost workforce productivity. Organizations also believe that activities such as culture building, collaboration, employee engagement, mentoring and innovation are easier in in-office settings. However, the COVID-19 pandemic caused many workers to reprioritize work as an aspect of their life instead of the main focus. Additionally, remote and hybrid work arrangements allowed employees to experience the benefits of working from home. Many have come to prefer these flexible work arrangements because they feel they can remain productive at work but have more resources and personal time for families and hobbies by not having to commute. This has allowed many employees to improve their work-life balance and general well-being.


While many employers requested that employees return to in-office work in 2022, they started requiring it in 2023. Organizations attempted to leverage the economic downturn to force employees to return to the office. However, as employers request or require employees to return to in-person work, many have refused or are not fully complying. Large corporations like Amazon, Apple and Twitter are currently struggling with workers refusing to follow return to office (RTO) orders. Employee refusals have caused some organizations to change course and soften RTO orders; others have doubled down on their efforts to have employees return, threatening to terminate those that don’t return. The return to office battle that has been simmering for the last few years seems to be nearing a boiling point, leaving many employers in a difficult position.


Employees’ refusal to return to the office has highlighted the different understanding between employees and employers as to the purpose of the office. It has also signaled a significant change in work culture and employee expectations. While the majority of U.S. workers do not work from home, for those who do, there’s currently a battle about where they’ll work in the future. By considering the reasons why employers want employees to return to in-office work and communicating those reasons to employees, employers are more likely to experience less pushback from employees. Employers can also consider the following strategies when asking employees to return to the office:


  • Determine the reasons why employees need to return.
  • Obtain employee input.
  • Provide clear guidelines.
  • Support employees during the transition.


Whether employers embrace flexible work arrangements or ask employees to return to the office, it’s important they help employees to find ways to help improve their mental health and well-being. This can enable employees to feel happier and more productive regardless of where and how they work.


Organizations Expand Family-building Benefits While Prioritizing Reproductive Health

The U.S. Supreme Court’s decision in Dobbs v. Jackson Women’s Health Organization to overturn Roe v. Wade— ending federal protections for abortion rights and permitting states to implement their own regulations— continues to impact employee benefits considerations in 2023. The Supreme Court’s ruling eliminating the federal constitutional right to abortion care has led to a patchwork of state laws on this type of health care; several states banned or restricted insurance coverage for abortion, while others require plans to cover the procedure. Legal challenges to these laws are currently ongoing, and more are expected going forward, making it unclear what the landscape will look like in the near future. This has created challenges for employers as they try to find ways to support their employees’ needs and provide competitive benefits. As a result, employers must carefully evaluate any reproductive health-related benefit offered under their group health plans to ensure full compliance with applicable laws and restrictions.


While the Supreme Court’s ruling has presented several important considerations for employers providing abortion-related benefits, it has also brought a renewed focus on reproductive health and family-building benefits. Many larger employers, such as Walmart and Target, have embraced fertility and family-planning benefits. This seems to be part of a broader trend of employers offering benefits that employees say they need, like mental health and financial planning resources. According to Maven Clinic’s State of Fertility & Family Benefits in 2023 report, 87% of HR professionals said they recognized family benefits are “extremely important” to current and prospective employees and 63% said they planned to increase family health benefits within the next few years. The same report revealed that 30% of employees are currently expecting a child or hope to grow their family within the next couple of years. Additionally, 43% said they expect to need fertility treatments, adoption services and surrogacy services to do so.


Many employers are doing more to support their employees through every stage of their family-building process. For example, employers are increasingly providing employees with family-friendly benefits, such as paid parental leave, paid adoption leave, surrogacy benefits, hormone replacement therapy and doula care. Others are providing specialized benefits to support women’s reproductive health by offering the following benefits:


  • Family planning assistance
  • High-risk pregnancy care
  • Pregnancy, lactation, postpartum and menopause support
  • Travel benefits


These benefits can have a significant impact on an employee’s productivity, happiness and overall wellbeing. Family-building benefits can also strengthen an organization’s attraction and retention efforts, improve employees’ quality of life and create an inclusive, healthy workplace. As workers continue to struggle financially because of inflation and other economic concerns, family-building benefits have become even more important since they can provide individuals and families with vital medical and economic support, enabling them to safely achieve their family-planning goals. In 2023, employers have a great opportunity to impact employees on and off the job by offering or expanding family-building benefits.


Employer Takeaways

In 2023, employers continue to deal with many of the same challenges they’ve faced for several years. Unfortunately, many of these challenges will likely continue through the second half of 2023 and into the foreseeable future.


It’s vital for employers to find ways to meet these challenges in practical and cost-effective ways, especially as the U.S. economy remains in flux. While the best strategies will vary by workplace, being aware of current benefits trends can guide employers as they strategize and take action. Recognizing these trends can help employers to respond in meaningful ways to help keep employees healthier, happier and more productive.


For more information on today’s benefits trends, contact us today.

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The Hidden Costs of Fragmented Workforce Management Vendors

September 2, 2025
Many businesses rely on multiple vendors to manage critical functions such as HR, payroll/HCM, benefits, commercial insurance, and retirement plans. While outsourcing can provide specialized expertise in each area, using separate providers often creates hidden costs that can quietly undermine efficiency, accuracy, and employee satisfaction. Here’s why integration matters, and how a consolidated approach can save time, reduce risk, and improve the employee experience. 1. Increased Administrative Burden When each service is managed by a separate vendor, administrative work multiplies. Employees and HR teams may spend extra hours logging into different systems to process payroll, submit benefits updates, or manage compliance tasks. Reconciling employee information across multiple portals and coordinating communications between vendors creates unnecessary complexity, which can distract your team from strategic priorities. 2. Higher Risk of Errors and Compliance Issues Fragmentation can increase the likelihood of costly mistakes. Payroll errors, mismanaged retirement contributions, and insurance coverage gaps often occur when systems do not communicate effectively. A single misalignment can have a ripple effect: Incorrect payroll deductions Late or missing retirement contributions Gaps in insurance coverage or compliance violations With multiple vendors, the risk of these errors and their consequences rises. 3. Limited Visibility and Reporting When each service lives in its own system, it’s hard to get a complete picture of your workforce. Without centralized reporting, many businesses struggle to: Analyze labor costs or benefits spending accurately Identify compliance gaps or coverage issues Track trends in employee engagement and retention Limited visibility makes it difficult to make informed decisions and optimize operations. 4. Compounded Costs Paying multiple vendors for separate services often results in more than just the sum of their fees. Each system typically comes with its own implementation, training, and subscription costs, which can quickly add up. In addition, internal administrative hours spent managing vendor relationships, reconciling conflicting data, or troubleshooting errors create a hidden expense that is often overlooked. Businesses may also face unexpected costs when trying to integrate or transfer data between disconnected platforms, or when compliance issues arise due to misaligned processes. Over time, these scattered costs compound, reducing overall efficiency and limiting resources that could be better spent on strategic growth initiatives. 5. Frustrated Employees The impact of fragmentation extends to employees. They may face confusion about where to access benefits or payroll information, experience delays in issue resolution, or encounter inconsistent communications. This frustration can lead to disengagement, lower productivity, and higher turnover. Businesses that integrate these functions provide a smoother, more cohesive experience for employees, resulting in higher satisfaction, better engagement, and a stronger workplace culture. Why Integration Matters Integrating HR, payroll/HCM, benefits, commercial insurance, and retirement services with a single partner simplifies operations, reduces errors, improves reporting, and enhances the employee experience. Businesses that consolidate services gain: Streamlined administrative processes and reduced duplication of effort Improved accuracy and compliance through connected systems Enhanced visibility into workforce metrics and financials Cost efficiencies by eliminating overlapping fees and redundant systems A more consistent, positive experience for employees By managing these services in a unified platform, your business can focus on growth instead of juggling multiple systems and vendors. Take the Next Step If your business is managing multiple vendors for HR, payroll, benefits, insurance, and retirement, it’s time to consider a more integrated approach. Streamlining these services with a single, high-touch partner like Simco can save time, reduce risk, and create a better experience for both your team and your employees.

Strategies for Supporting Employees During the School Year

August 25, 2025
As the 2025–26 school year gets underway, many employees are navigating the dual pressures of professional responsibilities and family life. For parents of school-aged children, this can mean adjusting to new routines, handling childcare logistics, and managing the emotional ups and downs that often accompany the start of the year. For employers, this season offers an opportunity to demonstrate support and strengthen employee loyalty. Below are nine strategies businesses can adopt to help their workforce balance work and family demands more effectively. Flexible Work Options Flexibility remains one of the most powerful ways to support working parents. Allowing employees to shift their schedules, such as starting earlier or later, or offering hybrid and remote work options helps parents handle school drop-offs, pickups, and unexpected schedule changes. For example, permitting an employee to work from home two mornings a week may relieve the stress of managing transportation while ensuring business needs are still met. When employees feel trusted to manage both work and family responsibilities, engagement and productivity rise. Back-to-School Support The transition into a new school year often involves extra expenses and planning. Employers can ease this burden by organizing back-to-school supply drives, offering stipends for educational expenses, or sharing curated lists of local resources like tutoring programs or after-school care. Some businesses even host “lunch and learn” sessions on topics such as family budgeting or time management during the school year. These gestures show employees that the company understands their life outside of work and wants to help them succeed in both areas. Prioritize Mental Well-Being Back-to-school season can be stressful for the whole family, with shifting routines, homework expectations, and social adjustments. Employers can proactively support mental health by promoting counseling services, stress management programs, or mindfulness workshops. Offering access to telehealth therapy sessions or creating quiet spaces in the office for breaks can make a tangible difference. Focusing on mental well-being helps employees feel cared for and creates a healthier, more resilient workforce overall. Paid Time Off for School Activities Balancing school commitments with work obligations can be difficult without supportive policies. By providing paid time off specifically for school-related events, such as parent-teacher conferences, school plays, or volunteering opportunities, employers can reduce the guilt or anxiety parents may feel about taking time away from work. Even a few hours of school-activity leave per semester can significantly boost morale and demonstrate the company’s commitment to work-life balance. Childcare Assistance Childcare remains one of the greatest stressors for working parents. Businesses can step in by offering childcare subsidies, backup childcare arrangements for emergencies, or partnerships with local providers to secure discounted rates. Employers with larger workforces may explore on-site childcare facilities or after-school program collaborations. Even simply sharing information about community resources and vetted childcare options can make a big difference for employees struggling to find reliable solutions. Open Communication Encouraging honest, ongoing conversations between managers and employees is essential. Managers should be trained to ask about potential school-year challenges, such as altered availability during drop-off hours or the need to leave for school events, without judgment. Creating a culture where employees feel safe discussing these needs allows managers to find practical solutions, like shifting deadlines or redistributing workloads, that benefit both the employee and the organization. Employee Assistance Programs (EAPs) EAPs are often underutilized, yet they can be invaluable during the school year. These programs typically offer access to counseling, parenting support, financial planning, and more. Employers should not only remind employees that these resources exist but also explain how they can be used during this time of year. For example, highlighting financial counseling services in September, when school-related expenses spike, makes the EAP more relevant and accessible. Family-Friendly Policies Workplace policies should reflect the realities of family life. Review scheduling practices to avoid early morning or late afternoon meetings when parents are often unavailable. Consider policies that allow parents to swap shifts or trade hours with coworkers. Involving employees in creating or revising family-friendly policies ensures the solutions are practical, widely supported, and foster an inclusive culture that values everyone’s needs. Recognition Matters Acknowledging the extra effort parents put in during the school year can have a lasting impact. Recognition doesn’t have to be large-scale, a personal thank-you note, a shout-out during a team meeting, or a small gift card can go a long way toward showing appreciation. Celebrating milestones, like surviving the first week back to school, helps parents feel seen and valued, reinforcing their commitment to the company. The Bottom Line Supporting employees during the school year goes beyond providing benefits; it’s about creating an empathetic, flexible, and responsive workplace culture. By adopting these strategies, businesses not only help their employees manage family responsibilities with confidence but also foster a more engaged, loyal, and productive workforce.
Is Your Business Ready for New York’s Secure Choice Savings Program (SCSP)?

Is Your Business Ready for New York’s Secure Choice Savings Program (SCSP)?

August 22, 2025
Big changes are on the horizon for New York businesses. Soon, many employers will be required to provide retirement savings options through the state’s Secure Choice Savings Program. If your business doesn’t already offer a retirement plan, now is the time to understand the rules, prepare your payroll, and explore whet

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