Executive Summary
Over the past few years, organizations have faced a number of challenges, including a global pandemic, shift to remote work, and a mass exodus of workers known as the Great Resignation. Moving forward, employers must also prepare for the possibility of an extended economic downturn, complete with its inherent uncertainty and inflationary pressures.
To navigate these uncertain times, leaders must make swift decisions and have a clear understanding of the steps needed to mitigate the impact of economic challenges on their organization and its employees. A well-thought-out plan that prioritizes both the well-being of the company and its employees will be crucial in ensuring the long-term success of the organization.
To gain a better understanding of these trends, Wellable conducted its annual Employee Wellness Industry Trends Report. The report, which is based on data collected from health insurance brokers and wellness consultants, explores investment trends, decision-making factors, and vendor criteria in the employee well-being field. It also includes special sections dedicated to mental health and financial wellness, looking at new solutions and top vendors employers are using in 2023. The findings provide valuable insights into the key trends that human resources leaders should be aware of as they navigate the current environment.
Investment Trends
The survey identified 23 specific wellness solutions and strategies that employers may be investing in during 2023. Respondents were asked whether they expect their employer clients to invest less, the same, or more in the associated programs.
Across all benefits included in this survey, 64% of respondents plan to spend more in 2023, 35% expect the same level of investment, and less than 1% expect a decrease in investment. As companies recognize the advantages of employee wellness programs and face increased competition for talent, many wellness offerings will likely continue to see more investment in the future.
Investment Trend Across All Benefits
- Investing Less
- Investing Same
- Investing More
As the economic landscape continues to evolve, companies will start prioritizing employee retention over talent acquisition in an effort to reduce costs and increase the effectiveness of their workforce. In 2023, this shift will become even more pronounced as businesses become increasingly aware of how costly replacing employees can be, with US employers spending $2.9M per day searching for replacement workers.
The focus on employee well-being is at an all-time high. Companies are increasingly taking proactive steps to improve their employees’ mental wellness, recognizing that it plays a major role in ensuring employee productivity, satisfaction, and retention.
Companies spent $51 billion on employee wellness in 2020, and that number is expected to rise to $100 billion by 2030. In 2022, the most popular solutions were employee assistance programs, digital health tools, and educational resources. Investing in mental health through employee wellness programs benefits both the organization and its employees as well as enhances the organization's appeal to job seekers.
In 2023, employers will provide more voluntary benefits to employees that address their unique circumstances for a personalized wellness experience. Benefits must appeal to a diverse workforce based on generational differences and social determinants of health, including environmental, economic, and social conditions that affect an employee’s well-being.
Rising Stars
Percentage Of Employers Investing More
In 2023, the majority of employers are expected to increase investments in the following benefits: mental health (91%), stress management and resilience (77%), mindfulness and meditation (74%), financial wellness (65%), and telemedicine (65%).
Mental health is a top concern for companies, with three out of the five rising stars closely related to this area. In addition to prioritizing employee mental health, companies are also investing in telemedicine to improve access to affordable healthcare.
Financial wellness is also making a comeback on the list, indicating that employers are proactively addressing their employees' concerns about the uncertain economic outlook.
Falling Giants
Percentage Of Employers Investing Less
In general, employers seem to be moving away from benefits that require in-person interactions, even with the COVID-19 pandemic restrictions being pulled back. This shift is likely due to the availability of alternative solutions that meet the same wellness goals at a lower cost and are better suited for a hybrid work arrangement.
For example, in the case of health fairs and on-site fitness classes, employers can often achieve the same wellness goals through more affordable and scalable options such as informational office hours with benefits providers, webinars, targeted marketing, and newsletters. These events can also be made virtual, which requires less investment.
Other trends are being guided by expert advice and the best available scientific evidence. For instance, employers have been decreasing their investments in biometric screenings and health risk assessments as research questions their efficacy. As organizations seek to develop more scientifically informed and evidence-based wellness solutions, it is predicted that these offerings will become less popular.
Decision Influencers
In addition to exploring areas of investment, the survey also asked brokers what criteria had the greatest influence on employee benefits decisions. After a significant dip in 2020, creating a competitive benefits plan has once again become a top priority for employers as they respond to employee burnout and retention challenges. The rising cost of benefits will also continue to be a significant influencer as companies prepare to strengthen their benefits packages and plan for unexpected costs and potentially volatile economic conditions.
With 2023 expected to be a year full of uncertainty, employers’ benefits decisions will reflect their best assumptions on how several critical questions will be answered.
Decision Influencers
Vendor Criteria
Seventy-three percent of respondents felt that pricing was a top three criteria for selecting wellness benefits vendors. This number was even higher for small- and medium-sized companies, with 83% and 79% reporting that pricing was a key consideration, respectively. In contrast, only 47% of large employers listed pricing as one of their top three concerns. Customer testimonials (2%) and domain expertise (6%) remained the least popular criteria.
Approximately two-thirds of companies (63%) valued a vendor's flexibility and customizability, a trend that is consistent with the previous year's results. This number was slightly higher for small companies (70%). These businesses may be looking for options to incentivize healthy behaviors while working within limited budgets.
Other important selection criteria included reporting and measurement (56%), innovation and technology (54%), and customer service (45%). Medium-sized companies (51%) placed a particular emphasis on customer service, compared to only 44% of large companies and 30% of small companies. Large companies (66%) tended to prioritize reporting and measurement, possibly due to a greater focus on monitoring costs and demonstrating the value of their investments.
After experiencing a significant drop (12 percentage points) in 2020, preferences for innovation and technology are almost back to their all-time high, with 54% of companies listing them as one of their top-three criteria. This consideration is especially influential among large companies (75%), as they tend to have more resources to spend on innovative solutions and are willing to explore unconventional approaches.
Mental Health
Mental health has remained a dominant concern over the past several years for employers. Rates of depression and anxiety are up significantly, as are all physical problems that these mental ailments can induce. As employers continue to appreciate just how vital mental health is for overall well-being, as well as a host of positive organizational outcomes, they are rapidly expanding the range of their mental health benefits.
What new offerings are your clients using to promote mental health in the workplace (choose top 3)?
To understand how organizations are enhancing their mental health support offerings, Wellable asked brokers to list the top three new benefits their clients are providing to promote mental health in the workplace. The most popular solutions are employee assistance programs (72%), digital health tools (50%), and education (45%), remaining consistent with last year's results.
Flexible work schedules continue to be a popular benefit for promoting mental health in the workplace, with 28% of companies offering them as a new benefit. However, the adoption rate of this benefit may not be higher due to a significant number of companies already offering flexible work schedules since the beginning of the pandemic. As a result, these organizations may no longer consider it a new offering, which could explain the lower response rate. Budgetary constraints may also be a factor in the low adoption rate of paid time off (PTO) for promoting mental health, with only 13% of organizations currently using PTO for this purpose.
Mindfulness and meditation resources are low on the list, with 19% of companies offering mindfulness classes as a new way to promote mental health. Again, this may be because companies have offered these resources for years. However, it may stem from a growing tendency among employees to rely on other resources to stay mentally well. While mindfulness and meditation are effective practices, some workers may need additional services, such as appointments with a therapist, to counteract the high levels of stress, anxiety, depression, and burnout they are experiencing. They may also be relying on the rapidly growing array of digital health tools, which a substantial portion of companies are adding to their suite of mental health services.
Other items appear low on the list due to limited scalability. For example, only 12% of businesses surveyed are now using coaching to promote mental health in the workplace, and only 1% are offering support groups.
Lastly, organizational culture changes are an underutilized strategy for promoting mental health in the workplace, with just 12% of companies planning on changing their cultures for this purpose. Most likely, this is because businesses feel that culture is difficult, if not impossible, to change. However, this appearance is illusory, as culture is readily modifiable. Moreover, attempts at changing culture will be well worth the effort, as the culture and general climate that employees work in every day can dramatically impact their mental well-being.
Additionally, brokers were asked to list their top mental wellness solutions. The results can be found below.
Financial Wellness
Financial wellness, defined as one’s degree of financial stability and overall ability to manage their economic life, is a relative newcomer to the wellness space. As such, companies are just beginning to formulate their financial wellness strategies, adding new solutions each year.
What new offerings are your clients using to promote financial wellness in the workplace (choose top 3)?
Respondents were asked to identify the top three new offerings used by their clients to promote financial wellness in the workplace. With this data, organizations can benchmark their strategies against their peers as they continue to refine their programs.
By and large, organizations are looking for cost-effective, flexible, and scalable solutions, which is why educational resources (81%), digital finance tools (62%), coaching (43%), and retirement planning (43%) are the most popular new offerings. Student debt assistance, while not on the top list, saw a 10-percentage point jump from last year. This trend is likely related to the high levels of student debt and the negative impact it has on individuals' financial well-being and the exacerbation of existing societal inequalities. Adding or increasing 401(k) matching programs (30%) is significantly less popular than other options, possibly due to budgetary concerns.
Digital finance tools are a surprising but welcome addition, as they offer employees on-demand access to an increasingly extensive range of financial resources. As digital finance tools increase in quantity and quality over the coming years, so will the percentage of companies who utilize this offering.
A clear trend again shows that scalable programs (such as educational programs and digital financial tools) are significantly more popular than the rest. Coaching is particularly challenging to scale. It is also less flexible, as employees must coordinate with coaches to find times that work for both parties. Student debt assistance is expensive and newer to the scene, meaning companies may be less familiar with how to implement this benefit. Also, student debt assistance may only benefit a subset of an employee’s population. Contributions to 401(k) accounts may appear less valuable to younger employees, who are looking for more control over what they invest in and may have more pressing needs that would be better met with alternative forms of financial assistance.
Additionally, brokers were asked to list their top financial wellness solutions. The result can be found below.
Explore The Data
When available, the report showcased six years of historical data. The gradual year-over-year trends provide useful context for the drastic changes brought on by the pandemic and the following economic uncertainty.
Investment Trends
2023 Investment Trends
Historical Comparison
- Investing Less
- Investing Same
- Investing More
2023 Investment Trends By Average Client Size
- Small (<250)
- Medium (250-1,000)
- Large (1,000+)
2023 Investment Trends By Years Of Experience
- 0-5 years
- 6-10 years
- 10+ years
Decision Influencers
2023 Influencers
Historical Comparison
- Minimally Influenced
- Somewhat Influenced
- Significantly Influenced
2023 Influencers By Average Client Size
- Small (<250)
- Medium (250-1,000)
- Large (1,000+)
2023 Influencers By Years Of Experience
- 0-5 years
- 6-10 years
- 10+ years
Vendor Evaluation
Historical Comparison
- 2018
- 2019
- 2020
- 2021
- 2022
- 2023
By Average Client Size
- Small (<250)
- Medium (250-1,000)
- Large (1,000+)
By Years Of Experience
- 0-5 years
- 6-10 years
- 10+ years
Appendix
Participant Profile
Respondent Locations
Average Client Size
Broker Years of Experience
Survey Questions
Where are you based?
How many years of experience do you have working in employee benefits or wellness?
0-5 Years
6-10 Years
10+ Years
What’s your average client size?
Small (<250)
Medium (250-1000)
Large (1000+)
How much are your clients investing in employee wellness compared to the previous year?
How much are your clients investing in the benefits listed below compared to the previous year?
How much are your clients’ decisions influenced by the factors listed below?
What are your top criteria when evaluating wellness vendors (choose top 3)?
What offerings are your clients using to promote mental health in the workplace (choose top 3)?
Which online counseling vendor would you recommend to your clients?
Which digital mental wellness solution would you recommend to your clients?
Which EAP solution would you recommend to your clients?
What new offering are your clients using to promote financial wellness in the workplace (choose top 3)?
Which digital financial wellness solution would you recommend to your clients?