A new year means new predictions for the year ahead. Here are a few of my predictions for the HR and benefits space in 2024.
Lower inflation, slower salary increases
From an economic standpoint, we might see some inflation relief in 2024. Inflation is steadily decreasing quarter-over-quarter and year-over-year. As of November 2023, the U.S. inflation rate is at 3.14%. We will likely see the reported inflation rate decrease to 2% by Q4 2024. Though inflation will decrease, the economy will continue to slow down, resulting in fewer salary increases and increased layoffs for U.S. workers.
Working from home will be a thing of the past
Over the last few years, companies like Amazon, Meta, and Microsoft have asked their employees to return to the office anywhere from one to all five days a week to create a pre-pandemic workplace culture. Employees have been reluctant to the change, some walking out in protest or resigning over the changes. While plenty of arguments exist that working from home leads to higher productivity, companies want to build camaraderie among their employees through in-person collaboration and culture. Plus, they want to recoup their investments in their office spaces.
Benefits will become more flexible…but at a cost
As companies are juggling up to five generations in the workplace, HR leaders will continue to seek flexible benefits options that meet the individual needs of employees and their families. One option gaining popularity is PTO conversion programs. PTO conversion programs allow employees to convert their unused PTO into financial wellness and social well-being benefits, such as charitable giving, student loan repayments, emergency cash, and travel.
That said, as companies add more voluntary benefits, the employees will bear the costs of the benefits.
Increased use of emerging technologies
Artificial intelligence (AI) & Web3 technology will continue to evolve and deliver ever-changing work environments to companies, rewards, and benefits. HR leaders and benefits providers have started implementing AI in their offerings and solutions to help streamline enrollment, enhance communication, and get real-time access to usage reporting and insights. Some common use cases for AI in the benefits space include decision support, personalized offers, comparing healthcare plans, and estimating costs.
Employers are going to be responsible for financial wellness
Financial stress is the most common distraction and concern for employees. As inflation, student loan debt, and emergency savings come to the forefront, helping employees meet their ever-increasing needs is critical to their well-being and productivity.
Hence, employees rely more on their employers to provide financial wellness support, forcing employers to implement financial wellness programs to support their employees’ financial wellness initiatives. Companies will look to implement more robust financial education resources and benefits options. Additionally, they will partner with specialized providers, such as PTO conversion program platforms, emergency relief fund providers, and more, to achieve a successful outcome.
Moreover, Secure 2.0 will start to positively impact employees’ financial wellness. Secure 2.0 will be the most impactful legislation for helping employees financially. Although somewhat tricky and cumbersome, the regulation will improve once technology can support the capabilities and regulations, ensuring that companies trying to implement it won't run afoul of other laws.
What are your top HR & benefits predictions for 2024?
Published on Dec 18, 2023 by Rob Whalen