US Employers Prioritize Financial Benefits Amid Generational Shift
Event summary
- Ascensus released its 2025–2026 Compensation, Retirement, and Benefits Trends Report based on a survey of 594 US employers.
- Employers are forecasting salary increases between 3.1% and 3.3% for 2026.
- 77% of organizations are planning or have implemented financial wellness plans.
- 88% of eligible executives participate in nonqualified deferred compensation (NQDC) plans.
The big picture
After a period of pandemic-related volatility, US employers are adopting a more strategic and employee-centric approach to total rewards, driven by the evolving expectations of Millennials and Gen Z. This shift reflects a broader trend towards prioritizing employee well-being and financial security to attract and retain talent in a competitive labor market, even as rising costs force difficult trade-offs. Ascensus, managing over $919 billion in assets, is positioned to benefit from this trend as companies seek technology and service platforms to manage these increasingly complex benefits programs.
What we're watching
- Cost Pressures
- Rising health plan costs, with one-third of employers seeing increases of 4-8%, will likely intensify pressure to shift costs to employees and accelerate HSA adoption, potentially impacting employee satisfaction.
- Talent Retention
- The continued reliance on NQDC plans for executive retention signals a potential vulnerability if these programs face increased regulatory scrutiny or become less competitive.
- Transparency
- The increasing prevalence of salary range transparency in job postings may lead to greater wage compression and necessitate more sophisticated compensation modeling to maintain competitiveness.
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