Competing for Talent in a Constrained Market

The labor market remains highly competitive, particularly for skilled and high-performing roles. Despite some macroeconomic cooling, the structural shortage of qualified talent persists: nearly three-quarters of employers continue to report difficulty filling key positions. At the same time, employee expectations have evolved — flexibility, security, and well-being now weigh as heavily as base compensation in determining employer preference.

For most organizations, benefits represent one of the largest investments in the total rewards portfolio. Yet in practice, those investments are often under-leveraged in the recruiting process. Health coverage, retirement plans, paid time off, and wellness programs frequently appear as a brief bullet point in job descriptions or are mentioned only when an offer is extended. By that stage, the opportunity to differentiate has largely passed.

Mployer’s recent survey of more than 700 companies across 17 industries found that employers who clearly communicate the value of their benefits — and substantiate that value through credible data or recognition — are nine times more likely to be selected by candidates and to convert accepted offers. Transparency and validation drive both higher-quality applicant flow and stronger offer acceptance rates.

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Transparency Converts Interest Into Action

In a competitive market, candidates are no longer applying indiscriminately. They evaluate prospective employers through publicly available information, reviews, and visible signals of value. When benefit information is vague, candidates interpret that as a risk. “Competitive benefits” have become shorthand for “average,” and uncertainty creates hesitation.

Conversely, when an organization provides a clear, quantified, and credible overview of its benefits, the dynamic changes immediately. Candidates are more willing to engage early, stay active through the interview process, and make faster, more confident decisions.

• 89% of candidates say they are more likely to apply when an employer provides clear benefit details.
• ‍90% say they are more likely to accept a role when benefits have been recognized or benchmarked externally.

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The Missed Opportunity: The Awkward Offer Conversation

In many recruiting processes today, the discussion around benefits occurs only after a verbal or written offer is made. The exchange is familiar: the candidate receives the offer, reviews the salary, and then pauses at the benefits section — uncertain whether what’s being offered is “good” or “below market.”

Recruiters often find themselves attempting to explain why the plan is competitive, citing anecdotal points about employer contributions or coverage levels. But without comparative data, the explanation sounds defensive, not differentiating. The candidate may nod politely but remain unconvinced — or worse, use the ambiguity to negotiate or delay.

At that stage, the opportunity to use benefits as a selling point has already been lost. The employer is reacting rather than leading.

In contrast, organizations that proactively communicate the strength of their benefits — in quantitative and comparative terms — enter offer discussions from a position of confidence. The candidate already understands the total value being provided and perceives the offer as comprehensive, not partial.

This is the distinction between defending your benefits and leveraging them. One undermines momentum; the other accelerates decisions.

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Making Benefits a Strategic Differentiator

Leading employers are now approaching benefits communication as a core component of their talent strategy — not an HR formality. Several best practices have emerged:

1. Integrate Benefits Early in the Candidate Journey
   Incorporate concise benefit summaries directly into job descriptions, career pages, and early-stage recruiting materials. Candidates should understand your total rewards value before they ever meet a recruiter.
2. Quantify Total Rewards Clearly
   Provide a simple, high-level estimate of annual benefit value. For example, “This role includes approximately $18,000 in annual benefit value beyond base salary.” Quantification allows candidates to make informed, apples-to-apples comparisons across competing offers.
3. Leverage Third-Party Validation
   External benchmarks and awards give candidates confidence that your benefits are not only competitive, but verified. Independent recognition communicates quality far more effectively than internal claims.
4. Equip Recruiters with Data
   Provide recruiters with accessible talking points and benchmark comparisons. When recruiters can articulate specifics — not generalities — they move from explaining to demonstrating.

These practices shorten time-to-hire, increase offer acceptance rates, and strengthen employer brand equity in measurable ways.

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From Hidden Cost to Competitive Advantage

For many organizations, benefits are treated primarily as a cost center — a compliance requirement and a necessary expense. In reality, they are one of the most powerful levers available for talent attraction and retention.

When the value of those benefits is communicated with clarity, evidence, and confidence, the perception shifts. The benefits package becomes part of the employer’s market narrative — a tangible signal of how the company invests in its people.

In a tight labor market, that clarity doesn’t just help you attract candidates; it helps you close them.

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How Mployer Enables Employers to Compete

Mployer helps organizations turn their benefits into a verified strategic advantage. We independently evaluate and rate employee benefit plans, comparing them across thousands of employers nationwide.

Participating organizations receive a clear assessment of how their benefits stack up against peers, along with recognition materials and benchmarking insights that can be shared directly with candidates. These assets — digital badges, comparison visuals, and concise summaries — give recruiting teams the ability to communicate benefit value credibly and consistently.

Employers across the country are already using Mployer’s data-driven validation to increase applicant volume, improve offer acceptance rates, and reinforce their reputation as employers of choice.

If you’d like to see how your benefits compare, we offer a free initial benchmark report to qualified employers. Join thousands of organizations already leveraging independent proof to strengthen their talent strategy — and move from explaining your benefits to winning with them.

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In today’s hyper-competitive labor market, the fight for high-end talent has become a defining business challenge. Organizations invest significant resources into hiring and developing high- performing employees—only to lose them to competitors offering slightly higher pay or better benefits. The cost of voluntary turnover is not only financial; it disrupts operations, damages customer relationships, and erodes company culture.This white paper explores how offering market-competitive benefits—and communicating them effectively—dramatically reduces voluntary turnover. Backed by Mployer’s proprietary benchmarking and benefit rating data, we’ll show how employers that promote their benefits will experience on average 27% lower voluntary turnover each year and potentially up to 51% lower annual turnover compared to peers.

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‍The Cost of Losing Great Talent

‍Every HR leader and CFO understands the financial cost of turnover—but few quantify its full scope. When an employee leaves voluntarily, costs include:

• Recruiting and onboarding new talent (often 30–50% of annual salary)

• Lost productivity during ramp-up and training

• Knowledge drain, as institutional know-how walks out the door

• Team disruption and morale impacts

• Customer relationship risks when account-facing employees depart

For specialized or customer-integrated roles, this loss compounds. A trained employee with both technical knowledge and deep integration into your teams and clients is a valuable asset—one not easily replaced. Studies show total turnover costs can exceed 1.5x–2x the employee’s annual salary for mid-level positions.

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‍The Talent War: Competing Beyond Compensation

‍Across industries, the labor market remains tight. Wage competition has intensified, especially in sectors where every dollar per hour matters—manufacturing, wholesale trade, and financial services among them. Employees are increasingly willing to move for small pay increases, unless they clearly understand the total value of their benefits package.This is where benefit perception and communication become critical. When employees can see and understand the full value of what you provide—healthcare coverage, retirement matching, paid leave, mental health support—they’re less likely to be swayed by modest salary increases elsewhere. In short, benefits visibility equals retention power.

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‍The Data: Better Benefits, Better Retention

‍Mployer Advisor’s analysis found that companies with highly rated benefits and effective benefits communication experience an average of 27% lower voluntary turnover than their peers. That’s a significant impact—one that directly translates into stronger productivity, reduced recruiting costs, and better workforce stability.How We Measured It: To understand how benefits quality and communication influence retention, Mployer Advisor conducted a cross-industry analysis using a blended methodology:

• Sample Group: Thousands of U.S. employers across key industries were evaluated, each with at least 50 full-time employees.

• Benefit Quality Scoring: Companies were benchmarked using Mployer’s proprietary benefit rating system, which integrates multiple data sources—including public ratings, plan benchmarking data, and employee feedback metrics.

• Communication Effectiveness: We measured not just the quality of benefits offered, but how clearly and frequently those benefits were communicated to employees through internal channels, digital materials, and recognition programs.

• Turnover Tracking: Over a 12-month period, we compared voluntary turnover rates among high-rated employers versus industry averages, focusing on trained, professional employees who had completed at least one year of tenure.The outcome was consistent and striking across every major sector: employers who both provide strong benefits and communicate them effectively retain significantly more of their trained workforce.

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‍What this means in Practice - Let's put these numbers into context:

‍• Example 1: Mid-Sized Manufacturing Firm (200 Employees) Suppose a manufacturing company employs 200 workers with an annual average salary of $60,000 and a typical voluntary turnover rate of 20%. That’s 40 employees leaving each year. Replacing and retraining them at a conservative cost of 1.5× salary would total $3.6 million annually. With improved benefits communication and recognition, this firm could reduce its turnover by 44%—down to 22 separations a year—saving over $1.6 million annually in direct and indirect costs.

• Example 2: Growth-Stage Tech Company (50 Employees) A 50-person software firm might see a 25% voluntary turnover rate in a competitive labor market. Replacing those 12–13 employees could cost roughly $25,000 each in lost productivity and recruiting, totaling $300,000 per year. By improving benefits visibility and achieving results similar to the 27% national average reduction, the company could retain an additional 3–4 key employees annually—saving $75,000–$100,000 and preserving critical institutional knowledge.

The data and the dollars tell the same story: when employees both receive and recognize valuable benefits, they stay longer. Employers who treat benefits as a strategic investment—not just a line-item cost—achieve stronger retention, higher engagement, and measurable savings year over year.

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‍Why Communication Matters as Much as the Benefits Themselves

‍Even the most generous benefits package fails to deliver ROI if employees don’t fully understand it. HR leaders often underestimate how little employees know about their coverage and perks. A recent survey found that:

• 46% of employees cannot accurately describe their health plan’s core benefits.

• Only 35% believe their employer communicates benefits “very effectively.”

• Yet 68% say that well-communicated benefits would increase their loyalty to the company.

Communicating benefits is no longer a once-a-year open enrollment exercise. It’s a year-round engagement effort that connects the dots between employee well-being and company investment.

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‍Turning Benefits into a Competitive Advantage

‍This is where the Mployer Benefit Recognition Program makes the difference.

Through our Employer Benefit Award and recognition system, Mployer provides third-party validation that your benefits are not only competitive—but also worthy of public recognition.

Participating employers receive:

• An unbiased benefits rating benchmarked against industry peers

• A benefit summary report highlighting your strongest advantages

• Award badges and recognition toolkit providing third-party credibility for your website, social media, and recruitment materials

• Ready-to-use social media templates to promote your benefits on LinkedIn and beyond

• A visually striking award poster to display on-site, sparking employee conversations about the value of your benefits

By leveraging Mployer’s independent credibility, employers transform their benefits from a hidden cost center into a visible differentiator—enhancing recruitment, retention, and brand perception simultaneously.

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‍Retention Starts with Recognition

‍In an era defined by labor shortages and rising turnover costs, the companies that win will be those that treat employee benefits not as an expense, but as a strategic investment.

The data tells the story: organizations that both offer competitive benefits and communicate them effectively enjoy up to half the turnover rates of their peers. Recognition, transparency, and consistent messaging are key to helping employees see the true value of what you provide.

Your workforce is your most valuable asset. Make sure they know how much they’re worth.

Learn more or see if your company qualifies for an Employer Benefit Award by visiting Mployer.

The modern labor market is defined by choice. In this competitive landscape, the time it takes to fill a critical position—your Time to Fill (TTF)—has become a painful metric. TTF measures the days between when a job is posted and when an offer is accepted, and every extra day costs your business. These are not just abstract numbers; they are tangible losses: decreased productivity from overburdened teams, halted projects, missed revenue targets, and increased recruiting fees (Source 1).

The solution to a high TTF doesn't lie solely in higher base salaries or aggressive sourcing. It lies in your benefits package.

Exceptional benefits are no longer a perk; they are the most efficient talent acquisition strategy to drastically reduce TTF. By treating your benefits package as a competitive differentiator, you can accelerate candidates through the hiring pipeline faster, saving thousands in the process.

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The Attraction Phase: Benefits as a Candidate Magnet

In the crowded digital space, a candidate's first interaction with your company is often filtering for what matters most to their life. This is where your benefits package first accelerates the process.

Filter Efficiency and Signal Quality

Candidates actively use benefit offerings as a primary search filter on major job boards. By offering superior benefits, your role gains instant visibility among highly qualified candidates who are explicitly looking for employer support.

Furthermore, a robust benefits package serves as a powerful signal quality indicator. It immediately tells a prospective hire that your company is stable, healthy, and genuinely employee-first. This signals a positive company culture, immediately making your job more attractive than competitors offering standard, minimal coverage.

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High-Value Benefits That Reduce Hesitation

Focusing on benefits that address major life stressors can dramatically shorten a candidate’s initial hesitation and application decision. High-perceived-value benefits like generous Paternity and Maternity Leave policies, comprehensive Mental Health Coverage, and practical Flexible Work Arrangements (Hybrid/Remote) instantly elevate your offer. These concrete; life-changing benefits are far more persuasive than a generic promise of a "competitive salary."

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The Conversion Phase: Benefits as a Negotiation Accelerator

Once you find a great candidate, the negotiation phase is where Time to Fill often stalls. Strong benefits act as rocket fuel, accelerating the offer acceptance and minimizing costly, time-consuming back-and-forth.

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Reducing Offer Time

When an offer is extended, a truly compelling benefits package often results in candidates accepting the first offer. They don't feel the need for lengthy counter-offers focused solely on base salary because the total value is already overwhelming.

A clear, well-articulated benefits statement in the offer letter minimizes follow-up questions, builds trust, and speeds up the decision-making process. The certainty and value provided by the benefits act as an irresistible closing tool.

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Framing the Total Compensation Advantage

To fully leverage this advantage, your HR team must be trained to frame the discussion around Total Compensation Value. Show candidates how elements like a 100% 401(k) match, fully-funded health insurance options, or student loan repayment programs can easily surpass a perceived $5,000 difference in base salary.

When candidates are weighing multiple offers, the company that provides the most security, flexibility, and value outside of the paycheck will significantly shorten the candidate's decision time, often securing the top talent before competitors can react.

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The Long-Term Ripple Effect on TTF

The benefits ROI doesn't stop once the offer is signed. A strategic benefits package initiates a powerful, long-term ripple effect that fundamentally lowers your overall vacancy rate and future TTF.

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Boosted Employee Referrals

Happy employees are your best and fastest source of talent. When staff are genuinely satisfied with their compensation and benefits (especially high-value items like Sabbatical programs or generous PTO), they become powerful advocates. This satisfaction increases the likelihood of employees referring high-quality candidates, who are typically onboarded faster because of the pre-vetted nature of the relationship. Referral hires are consistently the fastest and cheapest source of talent for any organization.

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Lower Turnover Rate

Ultimately, a high TTF is often symptomatic of high employee turnover. Strong benefits increase employee retention, meaning you have fewer open jobs to fill in the first place. Since TTF is calculated using both the vacancy rate and the duration of those vacancies, better benefits effectively tackle both components simultaneously.

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Quantifying the Benefits: TTF vs. Public Perception

The impact of your benefits is no longer limited to the candidates you interview; it's public. When candidates research a company, they immediately consult public review platforms like Glassdoor. These platforms link candidate sentiment directly to your hiring efficiency.

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Mployer’s recent analysis of 300 companies and over 2,000 open roles during a 120-day period revealed a critical connection between public sentiment and hiring speed. We compared organizations with exceptionally high Glassdoor benefit ratings (a key proxy for positive external perception) against those with mid-to-lower ratings. The result was a dramatic acceleration in the hiring funnel: for companies with top-tier benefit ratings, the average Time to Fill (TTF) was just 19 days, compared to 27 days for their counterparts—a significant 32% reduction in hiring time. While this trend was most pronounced among smaller organizations (like local businesses to mid-market firms), large global corporations (including Samsung, Morgan Stanley, and GE) demonstrated the same efficiency gain, affirming the universal impact of a strong benefit-based Employer Value Proposition.

Companies with an "Excellent" or "Above Average" benefit rating (4.0+ stars on Glassdoor, for example) consistently report a Time to Fill that is 15-20% shorter than industry peers with "Average" or "Poor" benefit ratings (Source 2). This efficiency is driven by the immediate credibility and trust built before the candidate even submits an application. A strong public rating reduces the need for the candidate to perform extensive due diligence, further accelerating the initial application phase.

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Enhanced Employer Brand

A consistently excellent benefits package strengthens your overall Employer Value Proposition (EVP). This enhanced brand, which is now supported by public data, naturally improves all future recruiting efforts by attracting passive candidates who have been watching your company’s reputation grow.

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Conclusion: The Investment That Pays for Itself

The takeaway is clear: investing in market-leading benefits doesn't cost money; it saves money by drastically reducing the tangible costs associated with lengthy vacancies, high recruiting fees, and low productivity.

Benefits act as an accelerant across all three critical phases of hiring: they Attract more candidates, convert them faster, and ensure their Retention, fueling a steady stream of future referral hires.

Action Item: Review your current benefits package through the lens of a prospective, top-tier candidate. Where can you add immediate, high-impact value? The race for talent is won by the company that makes the quickest, most compelling offer—and that starts with great benefits.  

To gain a competitive edge and identify your specific TTF acceleration points, benchmark your offerings today. See how your benefits stack up against industry peers through a free, unbiased rating: Visit https://mployeradvisor.com/employer-rating

Sources

1. Industry benchmarks, based on average daily revenue loss and recruiting overhead.

2. Modeled data based on aggregate findings from Q2/Q3 2024 Talent Acquisition Reports (e.g., LinkedIn Talent Trends, Glassdoor Economic Research).

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Navigating the New H1-B Reality: A Guide for HR Professionals

The H1-B visa program, designed to bring skilled foreign workers to the U.S. for "specialty occupations," is undergoing significant changes that demand your attention. The H1-B visa process is a multi-step, multi-cost journey. Before the recent changes, the primary costs were for filing fees, which typically ranged from $2,000 to $5,000, depending on the size of the employer and the specific application type [1]. The process begins with an employer submitting an electronic registration for a foreign worker during a specific period each March. If selected in the annual lottery, the employer then files the full H1-B petition with U.S. Citizenship and Immigration Services (USCIS). The annual cap is 85,000 visas, but demand consistently outstrips supply, with hundreds of thousands of applicants vying for a spot each year (USCIS, 2025). Historically, the program has seen a sharp increase in registrations, but a new beneficiary-centric lottery system implemented in recent years has helped curb duplicate applications, leading to a notable drop in eligible registrations for the most recent fiscal years.

The information technology (IT) industry is by far the biggest user of the H1-B visa, accounting for over 65% of visa holders (Image 2) [2]. This trend has been consistent, with major tech companies and IT consulting firms like Amazon, Tata Consultancy Services, Microsoft, Meta, and Google topping the list of H1-B sponsors. These companies primarily use the visa to fill roles for software engineers, data analysts, AI researchers, and other tech specialists. However, other industries like finance, healthcare, and higher education also rely heavily on the visa to fill specialized positions.

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Key Legislative Changes and What They Mean for HR

The landscape of H1-B hiring has been dramatically reshaped by two major legislative actions. In a significant move, a new proclamation was issued on September 19, 2025, which, as of September 21, 2025, requires a one-time $100,000 payment for most new H1-B petitions filed on behalf of beneficiaries who are outside the United States [3]. This substantial fee, a dramatic increase from previous costs, is aimed at discouraging the hiring of lower-skilled, lower-paid foreign workers and instead, incentivizing companies to hire the "best and brightest." For HR, this signals a major shift from a volume-based lottery strategy to a more meritocratic, high-cost model. The proclamation is currently slated to last for 12 months, but it may be extended or subject to further clarification from government agencies [4].

For current H1-B visa holders, and those with petitions filed before September 21, 2025, this new fee does not apply [5]. Existing visa holders can continue to travel and re-enter the country as they normally would, and visa renewals are not subject to the new fee. However, some legal experts advise against unnecessary international travel for those whose petitions were filed after the effective date, due to the lack of clear guidance on how the new fee would be applied upon re-entry.

Separate, but related, proposed legislation is currently moving through the rulemaking process. The Department of Homeland Security (DHS) is proposing a rule to replace the current random H1-B lottery system with a weighted selection process that would favor higher-skilled and higher-paid applicants. This proposed rule was published in the Federal Register on September 24, 2025, opening a 30-day public comment period that ends on October 24, 2025 [6]. After the comment period, DHS will review the feedback and may issue a final rule. If finalized in time, this new system could be in effect for the next H1-B cap season beginning in March 2026.

The new $100,000 fee and proposed changes are not without opposition. Many legal experts and industry leaders argue that the proclamation exceeds the President's authority by instituting a fee that is not tied to administrative costs, as fees typically are. Legal challenges are almost certain, and courts could potentially strike down the fee [7]. Furthermore, there is public and political pressure to repeal the measure, as critics argue it will drive talent and jobs overseas, harm U.S. competitiveness, and effectively dismantle the H1-B program for all but the largest corporations. While it is unclear if these efforts will succeed, HR professionals should stay informed on the evolving legal landscape, as a successful legal challenge could reverse these recent changes.

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Moving From Lottery to Elite Talent Strategy: Key Considerations

The H1-B program is no longer a volume game of chance but a calculated, high-stakes investment; a fundamental shift in the American talent strategy. For HR professionals, this means moving beyond reactive compliance and embracing a proactive, strategic role. You must become a key partner in workforce planning, advising leadership on how to balance global talent needs with the new financial realities. The path forward requires a focus on quality over quantity, meticulous legal vigilance, and a clear, well-communicated strategy for both current and future employees.

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Here are some key considerations as you begin to prepare the way forward for your own workforce:

1. Strategic Workforce Planning. The new $100,000 fee for new H1-B petitions filed for beneficiaries abroad makes sponsoring international talent a high-stakes, high-cost decision. Begin reevaluating your talent pipeline, prioritizing critical roles that require highly specialized skills, and considering if the investment is justified for each position. You'll need to work closely with department heads to identify essential roles that cannot be filled by the domestic workforce.

2. Budgetary and Financial Adjustments. The new fee is a dramatic increase from prior costs, which were typically under $5,000. For companies that rely on a large number of H1-B hires, this could add millions of dollars to the annual budget. HR and finance departments need to collaborate to re-budget for future international hires and plan for the potential financial impact.

3. Shifting to a Meritocratic System. The proposed weighted lottery system will favor higher-skilled, higher-paid applicants. This change moves the H1-B program away from a random chance and toward a system that rewards higher salaries. HR should be prepared for this by ensuring compensation for sponsored roles is competitive and aligns with the highest wage tiers to increase the chances of selection.

4. Navigating Uncertainty and Legal Challenges. The new fee and proposed changes are facing significant legal challenges. The situation is fluid, and further guidance from government agencies is expected. HR professionals need to stay informed by consulting with immigration counsel and legal experts regularly. It is also critical to advise current H1-B employees on the potential risks of international travel, as the new rules are still being clarified and could impact their re-entry.

The challenge is significant, but for those who adapt, the H1-B program will remain a powerful tool for securing the elite, specialized talent that drives innovation and growth.

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In-Text Citations

[1] NNU Immigration. (2025). H1B Visa Cost & Fees 2025. Retrieved from https://www.nnuimmigration.com/h1b-visa-cost/

[2] American Immigration Council. (2025). Trump's $100,000 Fee for H-1B Visas: What You Need to Know. Retrieved from https://www.americanimmigrationcouncil.org/blog/trump-100000-fee-h1b-visa/

[3] The White House. (2025). Fact Sheet: President Donald J. Trump Suspends the Entry of Certain Alien Nonimmigrant Workers. Retrieved from https://www.whitehouse.gov/presidential-actions/2025/09/restriction-on-entry-of-certain-nonimmigrant-workers/

[4] Holland & Knight. (2025). Summary of Presidential Proclamation: Restriction on Entry of Certain Nonimmigrant Workers. Retrieved from https://www.hklaw.com/en/insights/publications/2025/09/summary-of-presidential-proclamation-restriction-on-entry-of-certain [5] USCIS. (2025). H-1B FAQ. Retrieved from https://www.uscis.gov/newsroom/alerts/h-1b-faq

[6] Fragomen. (2025). United States: DHS Proposes Wage Level-Based Weighted System of H-1B Cap Allocation. Retrieved from https://www.fragomen.com/insights/united-states-dhs-proposes-wage-level-based-weighted-system-of-h-1b-cap-allocation.html

[7] The Guardian. (2025). Trump signs proclamation imposing annual $100,000 fee on H-1B visas. Retrieved from https://www.theguardian.com/us-news/2025/09/19/trump-h1b-visa-100000-fee

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The PBM Challenge in Today's Market

(An easy to understand guide)

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Prescription drug costs have surged dramatically in recent years, placing increasing strain on employer-sponsored health plans. Between 2000 and 2020, retail prescription drug spending in the U.S. nearly doubled (a 91% increase) and continues to climb—outpacing most other healthcare cost categories. The rise stems from two primary factors: expensive new specialty therapies (like weight-loss and biologic treatments) and the opaque role of Pharmacy Benefit Managers (PBMs) in setting prices. What makes matters worse is that Americans pay dramatically more than people in other high-income nations—U.S. drug prices average 2.78 times higher than in 33 comparable countries, and brand-name drugs can cost more than four times as much. This steep cost trajectory and global overpayment emphasize why understanding and managing PBMs has become essential for employers aiming to control healthcare spend and protect employees.

How PBMs Actually Work

When an employer designs its health plan, it either chooses a PBM directly or selects a carrier that already has a PBM embedded in its plan. From there, the PBM takes control of the prescription drug benefit. They build the formulary—the list of drugs that are covered—and negotiate with manufacturers to decide which drugs make the list. By narrowing coverage to certain products, PBMs gain leverage to demand better deals. They also restrict which pharmacies are in-network, again concentrating volume to maximize bargaining power.

This means PBMs effectively set the market, costs, and tiers employees experience: whether a drug falls into Tier 1 with a $10 copay or Tier 4 with a 25% coinsurance is dictated by the PBM’s design. On the back end, PBMs collect rebates from drug makers. A rebate is essentially a kickback payment from the manufacturer to the PBM, offered in exchange for favorable placement of a drug on the formulary or higher expected utilization. For example, if two similar drugs treat the same condition, the manufacturer willing to pay a higher rebate is more likely to have their drug chosen. Some portion of these rebates is passed back to the employer to lower plan costs, but a significant share is often kept by the PBM—one of the biggest transparency concerns in the system

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How Drug Tiers and Payment Structures Work

Most employer health plans organize prescription coverage into tiers, which determine both access and cost-sharing for employees.

• Tier 1 (Generics): Lowest-cost drugs, usually just a $10–$20 copay. They are widely accessible and often encouraged as first-line therapy.

• Tier 2 (Preferred Brands): Brand-name drugs that PBMs have negotiated discounts on. Employees typically pay $30–$50 copays or around 20% coinsurance.

• Tier 3 (Non-Preferred Brands): Higher-cost brand drugs not favored on the formulary. Employees may owe 40%+ coinsurance, leading to hundreds in out-of-pocket costs.

• Tier 4 (Specialty Drugs): High-cost therapies for serious conditions like cancer or hemophilia. These usually require coinsurance (20–30%), which can mean thousands of dollars per month. Although they make up less than 2% of prescriptions, specialty drugs drive nearly half of total drug spending.

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Copays vs. Coinsurance

• A copay is a fixed, predictable dollar amount per prescription.

• Coinsurance is a percentage of the total drug cost until the deductible or out-of-pocket maximum is reached. While it helps share costs, it creates unpredictability—especially for specialty drugs, where 25% coinsurance could mean $250 on a $1,000 medication or much more on therapies costing thousands each month.

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For employers, understanding how tiers and cost-sharing are structured is critical, since they directly affect both plan expenses and employee affordability.

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High-Cost Drugs and Their Outsized Impact

While high-cost drugs represent only a small fraction of total prescriptions, their impact on employer health plans is staggering. Specialty medications—such as those for cancer, hemophilia, and autoimmune disorders—account for less than 2% of prescriptions but drive close to 50% of all drug spending. Their costs have grown at double-digit rates year over year, fueled by new biologics, gene therapies, and infusion-based treatments that can run into hundreds of thousands of dollars annually. According to Sun Life’s High-Cost Claims Report, in many catastrophic claim categories like hemophilia or leukemia, prescription drugs make up more than 90% of the total cost of care. For employers, this means a single claimant on a specialty drug can dramatically shift overall plan spend, making pharmacy benefits one of the most volatile and financially significant areas to manage.

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How Carriers Handle High-Cost Drugs

Carriers cover most FDA-approved specialty drugs but tightly manage access and cost. They use formularies to decide which drugs are included (and on what tier), require prior authorization or step therapy before approving treatment, and often restrict dispensing to their own specialty pharmacy networks. Coverage is generally limited to drugs deemed medically necessary, while experimental or non-formulary drugs are excluded unless appealed. For employees, this can mean higher coinsurance, delays in approval, and fewer choices on where prescriptions can be filled.

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Who Controls the PBM Market—and Who’s Challenging It

Today, most carriers are tied to the “Big Three” PBMs, which together control more than 75% of the market:

• Aetna/CVS → CVS Caremark

• Cigna → Express Scripts

• UnitedHealthcare → OptumRx

• Anthem/Blue Cross (varies by region) → Caremark or Express Scripts

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This consolidation means that for many employers, pharmacy benefits are automatically bundled with one of these large PBMs, leaving little room for visibility or flexibility.  

The remaining 25% is made up of disruptors offering more transparent models. Players like SmithRx (pass-through pricing with detailed reporting), MedOne (independent PBM with customizable formularies and full rebate pass-through), and Mark Cuban’s Cost Plus Drugs (a direct-to-consumer model selling drugs at cost plus a small margin) are challenging the status quo. For employers, knowing which PBM their carrier relies on—and whether a carve-out to one of these disruptors is possible—can be a critical step in controlling pharmacy costs.

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Legislation and Reform Efforts

In recent years, lawmakers have increasingly targeted the opaque practices of PBMs, introducing multiple federal bills like the Pharmacy Benefit Manager Transparency Act (S. 127, 2023) and the PBM Transparency Act of 2025 (S. 526). These aim to ban spread pricing, require full rebate pass-through, and mandate detailed reporting—but none have passed into law yet. Similarly, a 2025 House bill dubbed the PBM Reform Act proposes greater transparency around Medicare Part D contracts and delinking PBM compensation from drug prices, but it remains pending in committee.

At the state level, all 50 states have enacted some degree of PBM regulation. Few states have gone further: for example, Iowa is considering a law imposing minimum pharmacy dispensing fees, and Arkansas passed legislation curbing PBMs’ ownership of pharmacies—though that law has been temporarily blocked by a federal judge

In short: there's plenty of activity at both federal and state levels—but no sweeping reforms have become law yet, leaving employers to manage PBM challenges proactively on their own.

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Be Educated: Key Questions to Ask Your Broker

1. Who is our PBM, and is it bundled with our carrier?

2. Do we receive 100% of rebates, or are they retained?

3. Can we carve out our PBM given our size and funding model?

4. Which high-cost drugs are driving our spend?

5. Do we get claim-level reporting from our PBM? (often not)

6. What specialty drug management strategies are in place?

7. How does our plan compare to industry peers?

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Closing Thoughts

Prescription drug costs are no longer a side issue—they’re a central driver of employer healthcare spend. The combination of high-cost specialty therapies and the opaque role PBMs play in setting formularies, controlling access, and managing rebates makes this one of the most complex and consequential areas of benefit management. For employers, the path forward starts with awareness: knowing which PBM you’re tied to, how rebates flow, which drugs are shaping your spend, and what levers you have to push for transparency or carve out alternatives.

While legislation at the federal and state levels may eventually bring more clarity and accountability to the PBM market, employers cannot afford to wait. By asking sharper questions, exploring disruptive PBM models, and partnering with brokers who understand this space, employers can take meaningful steps today to control costs and support employees more effectively.

Bottom line: Prescription drug costs are only going up. Employers that engage now—by digging into the details and holding PBMs and carriers accountable—will be best positioned to protect both their budgets and their people.

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Does Your 401(k) Plan Stack Up? Why Retirement Benefits Are the Quiet Power Player in Talent Strategy

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Key Takeaways

• Employers often overestimate the competitiveness of their 401(k) plans, while employees increasingly factor retirement benefits into job decisions.

• Match percentages alone don’t tell the whole story; vesting, plan design, admin fees, and investment performance all shape true plan value.

• Mployer has created the only solution that benchmarks retirement plans across 25,000+ designs, giving you a clear, data-backed rating.

• The top quartile of employers contribute nearly 2.3x more annually than the bottom quartile, and they outperform in participation and retention.

• With Insights+, employers can now evaluate their 401(k) offering with the same rigor as salary benchmarking, leading to a powerful edge in recruiting and retention.
  

The Strategic Blind Spot: Retirement Plan Competitiveness

Ask a benefits leader if their 401(k) plan is competitive and you’ll hear a confident “yes.” But ask based on what and the answers become fuzzier.

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Most employers assess retirement benefits by match rate or overall offering (“we have one, so we’re good”). But match percentage is just the tip of the iceberg. The truth is, retirement plan competitiveness is shaped by a complex set of variables, many of which fly under the radar for a lot of employees.

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From vesting schedules and administrative fees to plan flexibility and participation rates, the design of your 401(k) can quietly impact:

• Retention among mid- and late-tenure employees

• Offer acceptance among experienced candidates

• Total rewards perception and employee satisfaction

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And yet, few employers are equipped to quantify how their plan performs relative to the market.

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Until now.

Introducing Mployer Insights+: The First 401(k) Benchmarking Solution for Employers

Mployer’s Insights+ platform is the only system that allows you to benchmark your retirement benefits with meaningful accuracy and market alignment.

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Unlike outdated surveys or generic industry reports, Insights+ uses a 25,000+ plan dataset and proprietary scoring methodology to rate your retirement plan against your peers - by size, industry, and region.

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We analyze not just what you offer, but how it performs across four core categories:

• Employer Contributions

• Plan Design & Features

• Administrative Costs & Investment Returns

• Employee Participation & Utilization

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The result? A retirement plan competitiveness score that gives you the confidence and clarity to know exactly where you stand.

Why Match Rate Isn’t Enough

Let’s look at two hypothetical employers:

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Company A looks generous on paper, but if employees don’t stay long enough to vest, or the plan underperforms after fees, the realized value is far lower.

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Insights+ makes these trade-offs visible, quantifiable, and actionable.

What the Data Tells Us

According to the 2025 Mployer dataset:

• The average employer contribution is $1,286 per employee per year.

• But top-performing employers contribute over $2,900 annually, which is more than double the market median.

• 35% of plans still use vesting schedules that delay employee ownership of employer contributions.

• Administrative fees vary widely from 12.7 to 82.5 basis points, while 1-year returns range from 11% to 16%, depending on plan design.

• Only 21% of plans use auto-enrollment, despite its proven effect on participation rates.

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Participation rates reflect this disparity:

• Bottom quartile: 74%

• Top quartile: 94%

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Retirement Benefits = Recruiting + Retention Leverage

Retirement plans aren’t just a compliance checkbox - they’re a competitive differentiator. Mployer research shows:

• 23% of employees left a job in the last year for better benefits.

• 89% are more likely to apply to companies that clearly communicate benefits.

• Employees significantly undervalue their current benefits, incorrectly believing they are worth about $11,200 annually while the actual investment is closer to $23,200.

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That perception gap creates missed opportunities to recruit, engage, and retain the people you want most.

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What You Get With Mployer Insights+

Benchmarking your retirement plan is easier than you think.

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With Insights+, you’ll receive:

• A custom 401(k) Competitiveness Score

• A detailed breakdown of plan strengths and weaknesses

• Benchmarking across region, industry, and size

• Participation and contribution comparisons vs. peers

• A recognition kit for high-performing plans including badges and messaging templates to boost your employer brand

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Whether you’re evaluating your broker’s recommendation, planning open enrollment, or preparing for a comp review, this is the data advantage you’ve been missing.

See How Your 401(k) Stacks Up

‍In a labor market where top talent has options, strong retirement benefits can tip the scale in your favor - but only if you can prove it.

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Mployer Insights+ helps you:

• Quantify your retirement plan’s real value

• Compare against thousands of actual plans

• Make improvements with confidence

• Showcase your investment to candidates and employees alike

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Don’t settle for assumptions. Benchmark with precision.

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Ready to find out how your plan stacks up? Visit Mployer to get started.

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‍Editor's Note: This report is based on survey data from May 2025 that was published in June 2025. This is the most recent data available. (Source: Bureau of Labor Statistics)

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The unemployment rate has been remarkably steady for the past year, fluctuating between 4.0% and 4.2% during that term, although there are some significant warning signs that the labor market has softened.

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Meanwhile, US employers added 139 thousand jobs, which is on par with the approximate 149 thousand net jobs added over the last 12 months on average, albeit down more than 20% from last month’s initially reported figure of 177 thousand.

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While the number of people who have been jobless for 5 weeks or less increased by 264 thousand to reach about 2.5 million, a comparable amount of people (216 thousand) dropped from the ranks of the long-term unemployed - which includes people looking for a job who have been without a job for 27 weeks or more. 

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What may be more telling regarding the evolving labor market conditions, however, is the decrease in both employment-population ratio (which dropped 0.3% down to 59.7%) and labor force participation rate (which fell by 0.2% down to 62.4%), both of which indicate that more people are leaving the workforce.

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Of the net 139 thousand jobs added last month, the healthcare industry saw the largest uptick, with 62 thousand net new jobs, followed by the leisure and hospitality industry which added 48 thousand net jobs - nearly 2.5x the monthly average of 20 thousand net jobs recorded over the last year.

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The social assistance industry also had a net positive increase in payroll figures, adding about 16 thousand jobs all of which were in the individual and family services subset, but most of the rest of the industries saw no meaningful change in employment numbers -  except temporary workers and federal government workers, the latter of which declined by 22 thousand as more of the DOGE workforce cuts began to appear in the data. In total, the federal workforce is down almost 60 thousand jobs in 2025.

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The manufacturing sector and retail employees saw relatively minor declines in employment figures, as well. 

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Despite the potential softening of the labor market, average hourly wages increased by an average of 15 cents last month, climbing to $36.24 per hour. Average hourly earnings are up almost 4% over the last 12 months.

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The average number of hours worked weekly across the US, however, held steady at 34.3 hours for the third month in a row.

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Mployer’s Take

The waiting game continues in the labor market, which showed decent gains but also indicated that people are losing confidence in their ability to find a new job in the event that they lose their old one.

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Beyond the reductions to the federal workforce, people working temporary jobs saw the next largest decrease, and although that reduction was not particularly significant, fewer temp workers perhaps indicates that employers are being more cautious with their payroll expenditures.

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Continued uncertainty surrounding tariffs and federal budgets may be contributing to caution among business leaders, but the 139 thousand net jobs is marginally better than the 130 thousand jobs that economists were forecasting, so perhaps those uncertainties are essentially baked into the workforce calculation equations for the time being at least. 

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In effect, the lack of clarity about economic conditions going forward is likely causing employers to be patient when it comes to both hiring new workers and letting existing workers go.

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Incidentally, this jobs report will likely lead the Federal Reserve to exercise patience and caution when it comes to lowering the interest rate, as well.

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In short, the latest data largely indicates ‘business as usual’ for the immediate future, but with the tariff extension pause for most affected countries scheduled to wrap up in just under a month and with additional uncertainties emerging on the domestic front with regard to immigration enforcement actions and the resulting public response, ‘business as usual’ may be (or may not be) relatively short-lived.

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Check out the Mployer blog here.

Each month, Mployer collects and presents some of the most relevant and most pressing recent changes in law, compliance, and policy in areas related to employee benefits, health care, and human resources.

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EEO-1 Form Data Submission

As of May 20, 2025, the online filing system for Federal EE0-1 Data Submission is now open for submission. Private employers with 100 or more employees and federal contractors that meet certain criteria must submit the relevant data by June 24, 2025, which is less time to submit than in previous years. You can read more here. 

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I-9 Form Update

US Citizenship and Immigration Services released a new I-9 form on April 2, 2025. Some of the updates include replacing the word “non-citizen” with “alien” and the word “sex” has replaced “gender.”

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The previous I-9 forms - released on August 1, 2023 - remain valid until their listed expiration dates, in 2026 and 2027, respectively.

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You can find the new forms here. 

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State Updates

Colorado: Beginning July 1, 2025, Colorado employers that collect biometric data (e.g. fingerprints, retina scans, etc.) from employees and/or job candidates must follow the expanded guidelines laid out in the Colorado Privacy Act, which include implementing a written policy addressing biometric collection protocol and obtaining consent for the collection of biometric data. You can read more here. 

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Also Beginning July 1, 2025, employees taking continuous leave under the Family and Medical Leave Insurance program must be employed for 180 days prior to taking leave in accordance with the program, but employees taking intermittent leave, that job protection begins as soon as an employee hits their 180th day on the job, even if leave has already begun at that point. You can read more here. 

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As of May 16, 2025, Colorado has clarified that protected gender expression in the workplace includes chosen names and pronouns and that continuing to use a person’s birth name and pronouns against their wishes is an act of discrimination. You can read more here.

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As of February 1, 2026 Colorado employers that use artificial intelligence to evaluate employees and job applicants are required to take proactive measures to ensure that those platforms are not enabling discriminatory practices. You can read more here.

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Georgia: Employers in Georgia must begin phasing out below-minimum wage payments for employees with disabilities, with no new subminimum wage employment agreements beginning July 1, 2025 even for those employers with valid authorization certificates from the Department of Labor. Existing subminimum wage agreements must be equal or greater to half of the federal minimum wage by July 1, 2026 and must equal or exceed federal minimum wage standards by July 1, 2027. You can read more here.

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New York: As of May 8, 2025, NY employers with more than 3 employees must conspicuously post their lactation room accommodation policies and guidelines as well as the relevant state requirements both somewhere accessible by all employees and on the organization's intranet if applicable

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As of March 22, 2025, all New York employers regardless of size are prohibited from requiring job applicants or employees from providing a copy of their criminal history report that was obtained via the New York State Division of Criminal Justice Services. 

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As of  March 2, 2025, all New York employers are prohibited from requiring job applicants to provide a copy of their criminal history record, which closes a loophole employers had been exploiting to obtain such records despite restrictions regulating their access to those records.

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Beginning June 2, 2025, employers with 10 or more retail employees must have in place a written policy and training program for violence prevention measures and retail employers with 500 or more employees must install and/or maintain silent response buttons to alert authorities about emergencies. This legislation was originally slated to take effect March 4, 2025, But was amended to clarify employer responsibilities.

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Further, as of January 1, 2025, New York employers are required to provide 20 hours of paid prenatal leave during a 52 week period. Also, as of the new year, the characteristics to which equal protection was extended via the New York State Human Rights Law and the resulting protections are formally enshrined in the New York State Constitution. Those characteristics include: age, disability, ethnicity, gender identity, gender expression, national origin, pregnancy, and anything else related to reproductive healthcare.

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Oklahoma: Beginning November 1, 2025, Oklahoma is increasing the allowable tip credit - more info to come as it becomes available. You can read more here.  

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Oregon: Beginning July 1, 2025, Minimum wage increases across Oregon - climbing to $16.30 per hour in the Portland metro area, $15.05 per hour in standard counties, and $14.05 per hour in non-urban counties. You can read more about the increase schedule here and determine which counties fall into which categories here. 

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Beginning September 29, 2025, Oregon employers will be prohibited from asking candidates for certain age-related information like date of birth or graduation dates prior to and unless certain conditions are met. You can read more here. 

Beginning January 1, 2026, Oregon employees will be permitted to utilize sick leave for certain types of blood donations and Oregon employers will be required to provide employees certain information about earnings and deductions on their pay stubs - more information to come as it becomes available. You can read more here and here, respectively.

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As of January 1, 2025, Paid Leave Oregon provides leave for employees completing necessary legal steps associated with adopting and/or fostering children.

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Tennessee: As of April 11, 2025, employers in Tennessee are required to pay out all owed earnings in the event of an employee’s death. Previously, Tennessee employers could cap those payments at $10,000. You can read more here. 

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Washington: Beginning June 27, 2025, employees in Washington state will be permitted to use sick leave in order to address immigration-related issues. You can read more here.

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The Washington state legislature has also updated several laws governing when minors are allowed to work, employee protections, health care worker rest breaks, and workplace safety measures in certain industries. You can find those bills here, here, here, and here, respectively.

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Beginning July 27, 2025, Washington employers with at least 50 full-time employees will be required to provide 60 days written notice in advance of layoffs or business closures that result in the loss of employment for at least 50 full-time employees. You can read more here. 

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Also beginning July 27, 2025, Washington employers will no longer be able to require that employees have driver’s licenses unless driving is part of the job function and/or central to a legitimate business purpose, and Washington employers must provide current and former employees (for up to 3 years following their term of employment) with copies of their personnel files at no cost within 21 days of receiving the request. You can read more here and here, respectively. 

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The Washington state legislature also made updates to job posting disclosure requirements here that take effect on July 27, 2025, as well.  

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Beginning January 1, 2026, the Washington state Paid Family Medical Leave Act will be expanded to include smaller employers. You can read more here. 

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As of May 1, 2025, minimum wage in the city of Bellingham, Washington increased to $18.66 per hour. You can read more here. 

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Wisconsin: The Wisconsin Supreme Court ruled that state laws that protect job candidates and workers from arrest-record discrimination also apply to non-criminal offenses like civil violations. You can read more here. 

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Minimum Wage For Federal Contractors Rescinded

On March 14, President Trump rescinded Executive Order 14026 - which Biden signed in 2021 and raised the minimum wage for federal contractors from $10.10 per hour to $15 per hour with mechanisms contained within the order to continue increasing this wage minimum over time. 

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On January 1, 2025, in accordance with EO 14026, the minimum wage for federal contractors increased to $17.75 per hour, but now that Trump has rescinded EO 14026, it is unclear what the current minimum wage for federal contractors is.

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You can read more here.

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Alternative Manner For 1095-B & 1095-C Distribution

If your organization is using the alternative method for distributing 1095-B and 1095-C forms in accordance with the Paperwork Burden Reduction Act, your website must be in compliance from the first business day of March through at least October 15th. You can find guidance from the IRS about how to properly follow compliance protocols here.

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DEI Executive Orders Paused

On February 21, 2025, a federal judge put a stay on Trump’s Executive Order limiting the ability of federal agencies and federal contractors to operate Diversity Equity and Inclusion programs. The court questioned whether the order violated free speech rights and potentially illegally restricted otherwise legal actions taken by private entities. You can find the decision here. 

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Form 300A Submission Due

From February 1st to April 30th, non-exempt (low hazard) employers who had at least 11 employees at some point in 2024 must post in a conspicuous place a copy of OSHA Form 300A, Summary of Work-Related Illness and Injury, certified by a company executive.

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For non-exempt employers that had 250 or more employees at some point last year and employers with 20 or more employees in specified high risk industries, OSHA requires electronic submissions, which are due by March 2nd, 2025. 

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You can find the electronic submission platform here. 

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EAD Extension Formalized

As of January 13, 2025, the extension period for certain renewal Employee Authorization Document (EAD) applications filed on May 4, 2022 or later has been formalized at 540 days.

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You can read more here.

IRS Mileage Reimbursement Rate Increased

As of January 1, 2025, the IRS mileage reimbursement rate for road miles driven for business purposes increased by 3 cents per mile from 67 to 70 cents per mile driven. 

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‍DOL Reinstates Simplified Tip Credit Rule

In response to a Federal Court of Appeals Decision that vacated the so-called 80/20/30 rule that was instituted in 2021, the Department of Labor officially reverted to the previous tip credit rule.

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You can read more here.

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Increased ACA Flexibility and Affordability Threshold

As of January 1, 2025, the threshold for what qualifies as affordable coverage is now 9.02%, which means that an employee’s required contribution to the plan can be no more than 9.02% of their salary in order for the plan to be considered affordable and to avoid potentially paying the penalty. 

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You can read more about the affordability threshold here.

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IRS Publishes 2025 Annual Retirement Plan Maximums

• The 401(k) annual contribution limit increased from $23,000 to $23,500 in 2025.
• The catch-up contribution limit stayed unchanged at $7,500 for participants aged 50 and over.
• The SECURE Act 2.0 also instituted a new type of catch-up contribution, which enables participating people (age 60 to 63) to contribute up to $11,250 annually.

You can read more here. 

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IRS Publishes 2025 Annual Benefit Maximums

• The HFSA contribution max is $3,300 (maximum carryover is $650 for HFSAs with carryover features).
• The QSEHRA max for total reimbursements is $6,350 for single coverage and $12,800 for family coverage.
• The max employee tax credit for adoption assistance is $17,280, with additional conditions depending on employee salary range. 
• The monthly parking and mass transit benefit max is $325. 

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You can find the complete IRS 2025 benefit contribution limit list here.

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ERISA Guidance for Long-Term Part-Time Employees

You can find guidance for ERISA 403(b) plan eligibility requirements for long-term, part-time employees according to the updated standards from the Secure ACT 2.0 here.

How Benefits Correlate to Attraction and Retention

Why offering and communicating great benefits drives core HR performance

Hiring and retaining talent continues to be one of the biggest challenges facing employers today. With rising salary expectations and increasing turnover rates, organizations are under pressure to find sustainable, high-impact ways to attract and keep top talent.

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One of the clearest and most controllable drivers of success? Employee benefits. And just as importantly, how those benefits are perceived by employees.

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Our recent data from over 700 companies and 10,000 employees in 2024 and early 2025 confirms this: benefits are the second-most important factor influencing employee satisfaction, just behind compensation.

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In fact, 76% of employees cite benefits including medical, leave, retirement, and financial programs as a top reason they choose to join or stay with a company. That’s ahead of their boss, company culture, leadership, and even mission.

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In short: benefits are not secondary, they’re strategic.

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Why Benefit Expectations Are Higher Than Ever

Over the past few years, benefit expectations have shifted dramatically. The pandemic changed how employees think about health, family time, flexibility, and mental well-being. Rising out-of-pocket medical costs, the growth of remote and hybrid work, and a greater awareness of employer-provided financial security have made benefits one of the most discussed aspects of compensation - not just in exit interviews, but in Glassdoor reviews, LinkedIn posts, and team chats.

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Simply offering a health plan isn’t enough anymore. Today’s workforce expects benefits that are modern, inclusive, and meaningful. Employees also expect employers to communicate clearly about what’s being offered.

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That’s why we analyzed how employee-perceived benefit quality correlates with performance on key HR metrics. The companies that perform best? They don’t just offer strong benefits, they ensure employees know and value them.

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Great Benefits Drive Key People Metrics

32% Faster Time to Fill

Companies with highly rated benefits fill roles 32% faster on average. That’s not a small number when each open role represents lost productivity, added stress on teams, and missed business opportunities.

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One mid-sized tech company we worked with had a senior data role open for 90 days. At an estimated $1,000/day in opportunity cost and internal time, that single opening cost them over $90,000, and that figure doesn’t take delayed product launches into account. After updating how they presented their benefits and gathering employee feedback to showcase online, they cut their average time-to-fill to under 60 days for similar roles. That’s a $30K+ impact per hire.

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When job seekers understand the value of your benefits, they’re more likely to apply and say yes to offers, which can reduce your hiring cycle by days or even weeks.

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21% Lower Voluntary Turnover

Turnover is expensive, especially when it’s your best people walking out the door. Companies with top-rated benefits by employees saw 21% lower annual voluntary turnover. That’s a powerful retention lever. When employees feel supported through comprehensive health plans, generous parental leave, mental health resources, and financial wellness programs, they’re less likely to leave, even when other offers come their way.

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A 21% reduction in voluntary turnover on a 100-person team could mean keeping 10–15 more experienced employees each year. That’s not just savings, that’s momentum.

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9x More Likely to Be Selected by Job Seekers

In competitive markets, benefits are a differentiator - but only when they’re visible. Candidates are 9x more likely to choose companies that clearly showcase strong benefits. Whether on Glassdoor, your careers page, or through employee word-of-mouth, clear communication around benefits drives candidate behavior.

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Think of it this way: two companies offer similar pay. One has three bullet points on benefits. The other shows employee ratings, gives specific plan details, and includes testimonials. The choice becomes obvious.

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People don’t just want good benefits, they want to feel confident in what they’re getting, before they make a move.

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75% of Employees Who Rate Benefits as “Excellent” Also Rate Loyalty as “High”

There’s a strong link between benefits and employee loyalty. Among employees who rated their benefits as “excellent,” 75% also rated their loyalty to the company as “high.” That’s not a coincidence, it’s a signal. Benefits contribute directly to how connected, appreciated, and committed employees feel.

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Loyalty is about more than tenure, it’s about energy, advocacy, and long-term value. Benefits help build that loyalty day by day.

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What Counts as “Highly Rated” Benefits?

In our analysis, the companies with the strongest HR outcomes weren’t necessarily the ones with the most expensive benefits, but the ones with well-designed, well-communicated offerings that employees consistently rated highly.

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Highly rated benefits often include:

• Competitive medical plans with transparent costs
• Paid family and medical leave
• Mental health and wellness support
• Retirement matching or financial coaching
• Inclusive plans that support diverse needs (e.g., fertility, gender-affirming care, caregiving)

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What they all share is clarity and consistency, both in what’s offered and in how it’s experienced.

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Benefits Aren’t Just a Line Item - They’re a Leverage Point

The data is clear: companies that offer and communicate great benefits perform better across key HR and people metrics.

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Faster hiring. Lower turnover. Stronger engagement.

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And the connective thread through it all? Employees knowing their benefits matter and feeling the value in their day-to-day experience.

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Benefits shouldn’t be treated as background noise. They’re central to the employee experience and one of the few investments that directly influence both recruiting and retention outcomes.

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Want to understand how your benefits are perceived? Or see how you compare to other employers in your market?

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We’d be happy to show you, just reach out to start the conversation.

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Get your free Insights+ report today at mployeradvisor.com.

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The One Big Beautiful Bill: 6 Ways It Impacts Employer-Sponsored Healthcare

On May 22, the House narrowly passed the One Big Beautiful Bill Act of 2025, a sweeping legislative package that slashes over $1 trillion in healthcare spending - most notably through cuts to Medicaid, changes to Medicare, and tighter control over the Affordable Care Act (ACA) provisions.

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But buried in the bill’s 11th-hour amendments and complex fiscal shifts are several consequential reforms that could reshape the way employers provide healthcare benefits. It still needs to pass the Senate.

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Below, we break down six major provisions from the bill that will directly affect employer-sponsored healthcare plans, with added detail on what each means for HR leaders, brokers, and benefit consultants.

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1. ICHRAs Get a Boost: Favorable Signals and Financial Incentives

What changed?

The bill expands Individual Coverage Health Reimbursement Arrangements (ICHRAs) by allowing employees to use pre-tax dollars to purchase ACA marketplace (exchange) plans. For the first time, small employers who offer ICHRAs are eligible for a new tax credit (details pending Treasury guidance, but estimates suggest it could offset up to 50% of administrative and contribution costs for employers with fewer than 50 employees).

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Why it matters:

ICHRAs allow employers to reimburse employees for individual health insurance rather than providing a group health plan. The concept was initially met with lukewarm reception but has gained traction in recent years, though still minimal adoption (less than 2%).

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This bill signals an endorsement from the current administration, making ICHRAs a potentially central pillar of the future employer health plan landscape. With the exchange rules also being tightened (see #3), this move creates a more stable and predictable ecosystem for employers looking to shift toward defined contribution models.

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Expected impact:

Estimates from policy analysts suggest that this provision could increase ICHRA adoption by 20–30% over the next three years, bringing potentially 2–4 million more workers into ICHRA arrangements by 2027. This is still just 5% of employees on employer-sponsored care, but a few more tweaks could continue to increase that number.

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2. Health Savings Account (HSA) Expansion: More Flexibility, Broader Appeal

What changed?

The bill significantly loosens the rules around HSAs:

• Annual contribution limits increased (projected cap: ~$10,000 for individuals and $20,000 for families).
• Bronze and Catastrophic plans in the individual market are now deemed HSA-compatible.
• HSA funds can now be used for gym memberships, certain fitness apps, and sports-related activities (pending IRS definitions).

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Why it matters:

These updates make HSAs far more versatile and attractive. For employers, pairing HSA-qualified high-deductible health plans (HDHPs) with expanded HSA usage can serve as a cost-control strategy while still supporting employee wellness.

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The compatibility of Bronze and Catastrophic plans with HSAs also complements the ICHRA expansion, since many exchange plans fall into these tiers. It paves the way for consumer-driven health models that blend pre-tax benefits with individual choice.

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3. Stricter Exchange Rules and Employer Mandate Enforcement

What changed?

The bill implements a host of ACA exchange-related reforms, including:

• Stricter eligibility verification for subsidies and zero-premium plans.
• Shortened open enrollment by one month.
• Eliminated automatic re-enrollment into Silver plans.
• Insurers can deny coverage to applicants behind on premium payments.

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Why it matters:

These changes aim to clamp down on fraud and subsidy misuse - issues that have dogged the exchange system since inception. Reports indicated that some individuals overstated income or took advantage of lenient re-enrollment policies.

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From an employer perspective, particularly those using ICHRA models, this introduces both compliance pressures and risk mitigation benefits. While tighter enrollment rules may create more friction for employees navigating exchanges, they also stabilize the risk pool, potentially lowering premium volatility.

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4. Restoring Cost-Sharing Reductions: A Lifeline to Exchange Stability

What changed?

The bill restores cost-sharing reduction (CSR) payments to insurers that serve the lowest-income ACA enrollees. These payments that were defunded in 2017. At the same time, it bars CSR funds for plans that include abortion coverage.

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Why it matters:

CSR payments lower out-of-pocket costs for enrollees and stabilize insurance pricing. Their return is a boon to insurers, allowing them to offer lower deductibles and premiums on Silver-tier plans, particularly important for ICHRA participants who may rely on this tier to maximize value.

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It’s also a subtle but significant endorsement of the ACA exchange infrastructure, reinforcing its viability for employer-funded individual insurance. In effect, this provision serves as another indirect boost to ICHRA success.

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5. Pharmacy Benefit Manager (PBM) Reform: Transparency That Could Spill Over

What changed?

While most of the PBM reforms target Medicare Part D and Advantage, the bill:

• Requires PBMs to "delink" compensation from negotiated discounts.
• Bans spread pricing (when PBMs charge insurers more than they pay pharmacies).
• Increases data transparency requirements.

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Why it matters:

These changes don’t directly apply to employer-sponsored commercial plans...yet. But PBM practices are under bipartisan scrutiny, and Medicare regulations often act as a precedent for broader industry reform.

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Employers who self-fund plans or partner with third-party administrators (TPAs) could soon benefit from greater insight into drug pricing, rebates, and margins. At minimum, this raises employee awareness and expectation for cost transparency.

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6. Lawful Immigrant Coverage Restrictions: HR and DEI Challenges Ahead

What changed?

The bill restricts lawful immigrant access to unsubsidized exchange coverage and makes DACA recipients ineligible for premium subsidies.

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Why it matters:

For employers with diverse workforces - including those using ICHRA to cover part-time, seasonal, or contract labor - this provision introduces coverage challenges. Employees affected by these rules may face higher premiums or complete ineligibility for coverage options, potentially increasing uninsured rates.

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This raises ethical and equity questions, particularly for organizations committed to Diversity, Equity, and Inclusion (DEI) principles. HR leaders may need to rethink how they support affected workers, or whether to offer alternative employer-funded benefits.

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Final Thoughts

While the One Big Beautiful Bill is still awaiting Senate action and final reconciliation, its passage through the House offers a roadmap for where healthcare policy is heading, toward leaner federal spending, tighter exchange oversight, and growing support for consumer-driven models like ICHRAs and HSAs.

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For employers, this means:

• Proactive benefits strategy is key.
• ICHRAs are getting stickier and may soon become mainstream.
• Transparency and accountability will be expected across PBM, exchange, and employee communications.

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Now is the time for HR teams and brokers to evaluate how these shifts can be leveraged strategically—not just to stay compliant, but to build more flexible and cost-effective benefits for a changing workforce.

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Editor's Note: This report is based on survey data from April 2025 that was published in May 2025. This is the most recent data available. (Source: Bureau of Labor Statistics)

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US employers exceeded job forecasts by almost one-third, adding 177 thousand new entries to their payrolls last month, which was almost 40 thousand more than had been predicted.

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Only 5 states saw a net increase in jobs, however, while the remaining states and Washington DC recorded no meaningful movement in net job figures. 

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Meanwhile, the national unemployment rate remained essentially unchanged through April at 4.2%.

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Over the course of the month, however, 3 states plus Washington DC recorded an increase in statewide unemployment, while 2 states registered a decrease in unemployment rate and the remaining states saw no significant change.

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16 states have seen an increase in net jobs throughout the last 12 months, while the remaining 34 plus Washington DC have recorded no net movement over the year. 

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Below is the breakdown of the Bureau of Labor Statistics’ (BLS) market employment summary from the May 2025 report.

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States With the Highest Unemployment Rates

Washington DC was the ‘state’ with the highest unemployment rate last month at 5.8% overtaking Nevada which had been on a 5-month streak with the highest unemployment rate. 

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The unemployment rate in Washington DC climbed from 5.6% to 5.8% over the month, while Nevada’s unemployment rate continued its downward trajectory, decreasing from 5.7% to 5.6%.

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Only 5 other states recorded an unemployment rate that was significantly above the national average in April - Michigan (5.5%), California (5.3%), Kentucky (5.2%), Ohio (4.9%), and Illinois (4.8%).

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Besides Washington DC, there were only 3 states that recorded an increase in unemployment rate - Massachusetts (+0.2% unemployment, climbing from 4.4% to 4.6%), Iowa (+ 0.1%, rising from 3.4% to 3.5%), and Virginia (+0.1%, increasing from 3.2% to 3.3%). 

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Over the last 12 months, 27 states have recorded an increase in unemployment rate, led by Mississippi at plus 1.2% and Michigan at plus 1.1%.

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States With The Lowest Unemployment Rates

South Dakota notched its 16th consecutive month as the state with the lowest unemployment rate, holding steady at 1.8% through April. 

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In total, 19 states recorded unemployment rates significantly below the national average of 4.2%. While South Dakota was the only state to show unemployment below 2%, there were 4 states with unemployment rates below 3% last month - Hawaii (2.9%), Montana (2.7%), Vermont (2.7%), and North Dakota (2.6%).

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Over the last month, only 2 states recorded a drop in unemployment rate - Indiana (-0.2%, decreasing from 4.1% unemployment to 3.9% over the year), and Nevada (-0.1%, falling from 5.7% to 5.6%). 

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Over the last 12 months, only Montana posted a net decrease in unemployment rate at - 0.3%.

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States With New Job Losses

No state recorded significant net job losses over the last month or over the last year.

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States With New Job Gains

5 states saw a significant increase in net jobs over the course of April. Texas had the largest increase in raw state payroll count at almost 38 thousand, followed by Ohio at about 22 thousand, and North Carolina at about 18 thousand.

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In terms of proportional job growth, Arizona, Connecticut, North Carolina, and Ohio all recorded a 0.4% increase, while Texas posted 0.3% growth.

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From April 2024 through April 2025, 16 states recorded a net increase in job growth, with the largest raw figure increases occurring in Texas (plus about 216 thousand jobs), Florida (plus about 144 thousand jobs), and New York (plus about 114 thousand jobs).

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The largest percentage increase in the state workforce over the last 12 months, however, was claimed by Hawaii (plus 2.7%), followed by South Carolina (plus 2.4%), and Idaho (2.3%).

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Mployer’s Take

This report represents the final data from Trump’s first 100 days in office during his second term, which is historically when presidents accomplish a disproportionate amount of their agendas. 

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That said, many of the workforce cuts in the federal government that have taken place since Trump repurposed the Department of Government Efficiency led by Elon Musk to the task have yet to impact the unemployment and jobs data due to how and when those job reductions are captured and measured.

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Similarly, while the threat and implementation of tariffs may yet have a more significant impact on national employment, the vast majority of tariffs that Trump implemented are currently on pause for another 6 weeks, and while the uncertainty is likely affecting the labor market to some degree, the impacts thus far have been relatively minimal. 

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The continued strength of the labor market has significantly reduced the likelihood that the Fed will bring down interest rates when they meet again to discuss the matter next month. In fact, rate reductions at any point over the summer are looking less realistic at this point, although conditions can change very quickly, especially in the event that the tariff pause is not extended when it expires in early July.

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Perhaps the most significant indicators of economic problems that may lay ahead are the interest rates attached to US Treasury bonds, which have been increasing as current investors (both foreign and domestic) unload their bond holdings to a buyer pool that is demanding increasingly higher returns.

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Those bond interest rate increases reflect decreased confidence in both short and long term US economic health and increased concern in the ability of the US government to service its growing debt. 

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Further, these issues may become exacerbated should the Senate get on board with the House’s Big Beautiful Bill given the trillions of additional debt the plan will result in if ultimately enacted into law and if the US GDP growth is unable to offset the spending increases and tax cuts included in the bill. 

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The US recorded negative GDP growth in the first quarter of 2025 and if that trajectory holds or continues downward, the US economic conditions will be formally labeled as a recession as early as July as well, and while negative GDP growth in the current quarter is not a foregone conclusion, crossing that threshold would likely result in other negative economic feedback effects to pile on the situation.

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In short, July may be a very meaningful month when it comes to both determining and assessing the US economic trajectory going forward.

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Looking for more exclusive content? Check out the Mployer blog.

FOR IMMEDIATE RELEASE 

Mployer Launches Sun Life Stop-Loss Data Integration, Enhancing Access to Stop-Loss Insights for Leading Consultants & Employers 

Nashville, TN – May 22nd, 2025

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Mployer, the nations’ leading employee benefit ratings platform, has partnered with Sun Life U.S. to bring expanded stop-loss analytics into its Mployer Insights platform — giving leading consultants, brokers and employers more powerful tools to navigate rising healthcare costs with clarity.

This partnership introduces Sun Life’s multi-year claims analytics, including detailed stop-loss patterns, trends in high-cost conditions and high cost drug utilization, directly into Mployer’s benchmarking and reporting features. With this addition, consultants and brokers can better anticipate risk patterns and deliver stronger, data-driven guidance to clients. 

“Mployer and Sun Life are partnering on new ways to bring valuable stop-loss information and other cost-containment strategies into the hands of employers and leading brokers,” said Brian Freeman, CEO at Mployer. “We are excited to work with leading benefits advisors supporting their work in turning complex claims trends into smarter strategies for their clients.”

The new Sun Life-powered features are available now, with more updates and data expansions to follow later this year. 

“This partnership strengthens our mission to provide clear, actionable insights that help brokers guide their clients through complex healthcare and benefit decisions,” said Brian Freeman, CEO at Mployer. 

The updated Insights platform is available now, with additional data sources and enhancements planned throughout 2025. To access sample reports or request more detail, go to MployerAdvisor.com.  

About Mployer 

Mployer is redefining the industry standard for benefits analytics by empowering employers, employees, and benefits consultants to easily assess, rate, and communicate the value of employee benefits. Driven by rising employer costs and increasingly competitive hiring markets, Mployer brings transparency to an industry that affects the over 160 million Americans on employer-sponsored health plans. 

About Sun Life 

Sun Life is a leading international financial services organization providing asset management, wealth, insurance and health solutions to individual and institutional Clients. Sun Life has operations in a number of markets worldwide, including Canada, the United States, the United Kingdom, Ireland, Hong Kong, the Philippines, Japan, Indonesia, India, China, Australia, Singapore, Vietnam, Malaysia and Bermuda. As of December 31, 2024, Sun Life had total assets under management of C$1.54 trillion. For more information, please visit www.sunlife.com. 

Sun Life Financial Inc. trades on the Toronto (TSX), New York (NYSE) and Philippine (PSE) stock exchanges under the ticker symbol SLF. 

Sun Life U.S. is one of the largest providers of employee and government benefits, helping approximately 50 million Americans access the care and coverage they need. Through employers, industry partners and government programs, Sun Life U.S. offers a portfolio of benefits and services, including dental, vision, disability, absence management, life, supplemental health, medical stop-loss insurance, and healthcare navigation. Sun Life employs more than 8,500 people in the U.S., including associates in our partner dental practices and affiliated companies in asset management. Group insurance policies are issued by Sun Life Assurance Company of Canada (Wellesley Hills, Mass.), except in New York, where policies are issued by Sun Life and Health Insurance Company (U.S.) (Lansing, Mich.). For more information visit our website and newsroom. 

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Key Takeaways

• Most employees drastically underestimate the value of their benefits—valuing them at $11,200 on average vs. a true value of $23,200
• Employers lack a clear, credible way to showcase the value of their benefits or compare against the market
• Proving you offer competitive benefits lead to lower voluntary turnover, shorter time to fill roles, and a 9X increase in quality applicants
• Mployer’s Insights+ platform uses a proprietary, data-backed scoring methodology to benchmark your benefits across the four core pillars of employee benefits – medical, ancillary, leave and retirement
• With access to the largest benchmarking dataset in the industry, Insights+ enables custom cohort comparisons and ratings by your by industry, region, and size
• To see how your benefits compare to companies just like you, reply and let us know

_{The Perception Gap: Why Competitive Benefits Are a Strategic Advantage}

Ask any employer if they offer competitive benefits, and you’ll likely get an awkwardly confident “yes.” But dig a little deeper—compared to who? Based on what? That’s where things break down immediately.

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The reality is: employee benefits today are judged almost entirely based on perception, not proof.

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Employees, on average, believe their benefits are worth about $11,200. In truth, employers are investing nearly $23,200 per employee per year per Mployer’s Insights+ 2025 study across companies representing over 1M employees. That’s a massive gap in perceived value—and one that significantly undermines retention, recruiting, and engagement.

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When you can prove that your benefits are competitive—not just internally, but compared to your true market—you unlock a measurable strategic advantage:

• Lower voluntary turnover
• Faster time to fill roles
• 9X improvement in qualified applicants

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But proving benefit competitiveness takes more than guesswork or gut feel. That’s why we built Insights+—a first-of-its-kind platform that turns perception into data-backed proof.

Introducing Insights+: The Industry Standard for Benefits Benchmarking

At Mployer, we’ve spent years building Insights+ in partnership with the top insurance brokerages in the country. It’s the most advanced, statistically accurate benchmarking system on the market, designed to give employers a true understanding of their benefits competitiveness.

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Here’s how it works:

• We ingest your benefits guide or a quick intake form
• Our engine scores your plan across four core components (more on that below)
• We benchmark your plan against a custom peer group of employers like you, same industry, region and size —not a generic industry average.
• You receive a full report and rating that you can share with your team, inclusive of:
  • An overall rating (it’s pretty great)
  • Strengths, weaknesses, and gaps
  • Comparison vs. peers on spending and participation
• Plus, if your score ranks highly—you receive a recognition toolkit with ready-to-use materials for employee education, recruiting, and brand positioning

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This isn’t a one-size-fits-all solution. It’s a proprietary methodology built on a 30,000+ employer dataset, kept current through direct employer uploads, broker partnerships, and more.

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How We Score Benefits: The Four Core Components

Competitive benefits can’t be measured by a single number like "how much you spend" or whether you offer a 401(k). It takes a holistic view—and that’s what our four-pillar scoring system does.

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These are the four foundational categories we use to assess the true competitiveness of a plan:

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1. Medical

This includes everything from your monthly premiums to deductible levels, plan options, and employer contribution percentages. It’s typically the most expensive part of your benefits package—and the most scrutinized by employees. We evaluate depth of coverage, choice, affordability, and access and compare your plan to your cohort.

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2. Ancillary

Dental, vision, disability, life and voluntary insurance fall here. Our methodology weighs plan richness, employer contribution for each individual line item. While often considered secondary, ancillary benefits play a big role in perceived value—and they’re a low-cost lever for improvement.

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3. Leave

PTO, holidays, parental leave, and—critically—flexibility (remote, hybrid, compressed schedules). We evaluate not just what's offered, but how it compares to market expectations within your peer group. Leave policies are increasingly make-or-break in competitive industries.

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4. Retirement

401(k), 403(b), ESOPs, and other savings mechanisms. We assess both participation structures (e.g., automatic enrollment, matching formulas) and actual dollar contributions compared to peers.

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Our scoring system blends employee perception, plan design, cost, and participation data to generate a truly holistic and market-relevant evaluation.

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No other system in the industry brings this level of depth, customization, and credibility.  Want to see how you compare? Let us know.

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Benchmarking Against a Custom Peer Group

Forget comparing yourself to national averages or sample data from a survey two years ago. With Mployer, you benchmark against a precisely matched peer group.

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We offer the largest and most granular dataset in the industry, covering over 30,000 employers and growing. This enables you to compare your benefits offerings against statistically valid cohorts based on:

• 30+ Industries (from healthcare to logistics to tech)
• 8 Organization Sizes (from <25 employees to 10,000+)
• 8 U.S. Regions (ensuring geographic relevance)

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Only with us can you create a peer group so tailored that it mirrors your recruiting market, reflecting what companies like yours—and hiring for the same roles—are doing.

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Whether you’re a manufacturing firm in Ohio or a startup in Austin, your competitive landscape looks different. We ensure your comparison group matches reality, not abstraction.

Competitive Benefits as a Strategic Advantage

We say it often because it’s true: benefits are more than a cost center—they’re a strategic asset.

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When your benefits are perceived as strong, you get:

• More applicants (especially the ones you actually want)
• Fewer people leaving for marginal improvements elsewhere
• Stronger employee engagement and satisfaction

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But all of that starts with knowing how you compare—and having the data to back it up.

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Insights+ doesn’t just show you where you stand. It gives you the tools to improve, the proof to showcase what you already do well, and the recognition materials to ensure your benefits investment is seen and appreciated by the people who matter.

See How Your Benefits Stack Up

If you’re ready to move beyond guesswork and prove that your benefits are truly competitive, Insights+ is your next step.

You’ll get:

• A customized, data-backed Benefits Competitiveness Score
• Insights into where you're ahead or behind the curve
• Benchmark comparisons across size, region, and industry
• A recognition kit if you score well—complete with messaging tools, badges, and recruiting assets

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Best of all? It’s free for employers to get started.

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Let us show you what great benefits really look like—on paper, in practice, and in perception.

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FREE Insights+ Reports For Qualifying Employers

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‍Editor's Note: This report is based on survey data from April 2025 that was published in May 2025. This is the most recent data available. (Source: Bureau of Labor Statistics)

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The job market once again proved to be more resilient than economists were predicting, with US employers adding 177 thousand jobs over the course of April as the unemployment rate held steady at 4.2%.

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That figure of 177 thousand new jobs significantly exceeds the approximate 135 thousand new jobs that economists had forecast and is on par with the prior month’s ultimate report of 185 thousand new jobs (revised down from an initially-reported and headline-grabbing 228 thousand new jobs).

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The number of long-term unemployed people rose by about 180 thousand to reach 1.7 million people, which is an increase of almost 12%. Long-term unemployed people - those who have been out of work but seeking it for 27 weeks or more - account for almost one-quarter of all unemployed people. Long term unemployment has increased by more than one-third over the last 12 months, up from about 1.25 million in April of 2024.

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There was little change across most other metrics over the course of the month, however, with the employment population ratio (60%), labor force participation rate (62.6%), the number of people working part time for economic reasons (4.7 million), and the number of people who want a job (5.7 million) all essentially holding steady over the month.

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Of the 177 thousand net jobs added last month, the healthcare industry was responsible for the largest proportion, adding 51 thousand jobs over the course of April, which is just below the 52 thousand net new payroll entries averaged each month over the last 12. 

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The transportation & warehousing industry had the next largest net job increase in April, increasing its ranks by abou 29 thousand, with the financial activities industry and the social services industry claiming the addition of 14 thousand net employees and 8 thousand net employees, respectively, as well.

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While there was no significant change over the month in most other industries, federal government employment did register a noteworthy drop of 9 thousand employees, bringing the total number of net federal jobs lost in 2025 to 26 thousand, although that figure does not represent the entirety of the situation - more on that to come.

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Average hourly pay rose by about 6 cents to an even $36.06 per hour (an increase of 0.2%) over the month while the increase was about 3.8% over the last year - up from $34.67 per hour for privately employed, non-farm workers. 

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The length of the average workweek grew slightly over the month to 34.3 hours per week. 

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Mployer’s Take

The headline story from the jobs report is the continued strength of the labor market even in the face of economic forces like the threat and/or implementation of sweeping global tariffs, but the labor market alone does not tell the entire story of the economic moment.

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For one, the federal workforce reductions instituted by Elon Musk’s Department of Government Efficiency may be 10 times larger than the 26 thousand jobs that have so far registered in this data, but those numbers won’t show up until those employees severance/leave pay has expired. 

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Even more importantly, the GDP dropped by .03% through the first 3 months of 2025, which is the first contraction of GDP in 3 years, and while looming tariffs and federal firings were certainly contributors, those factors are more likely to have an increasing influence over the economy as a whole in the coming months than a decreasing influence.

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Still, despite the lag in capturing federal employees whose jobs were recently terminated in these data sets and despite the uncertainty surrounding both the tariffs and their impact, this jobs report indicates that employers are still carrying on hiring, which itself is a kind of vote of confidence for the continued resilience of the US economy.

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Further, inflation is up only 2.3% from last year and the rate of increase is trending downward, which is another positive sign, yet many economists (and employers) remain pessimistic about our chances for avoiding economic downturn in the months ahead.

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The Federal Reserve will soon be facing the decision again about what to do with interest rates, and although inflation is nearing the Fed’s stated target of 2% annualized inflation, in light of the potential inflationary pressure that tariffs are capable of producing, the Fed may be less eager to lower interest rates now than they otherwise may have been given the current inflation levels.

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We’ll know more about the Fed’s short term plan for interest rates in just a couple days, but we are still a ways off from knowing the ultimate impact of tariffs and federal workforce restructuring. 

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In light of the first quarter economic contraction, however, and in light of the fact that economic recession can be defined as two consecutive quarters of negative GDP growth, it’s entirely possible that the current economic conditions are retroactively labeled as a recession as soon as July, even with the labor market still humming along.

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Check out the Mployer blog here.

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Each month, Mployer collects and presents some of the most relevant and most pressing recent changes in law, compliance, and policy in areas related to employee benefits, health care, and human resources.

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I-9 Form Update

US Citizenship and Immigration Services released a new I-9 form on April 2, 2025. Some of the updates include replacing the word “non-citizen” with “alien” and the word “sex” has replaced “gender.”

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The previous I-9 forms - released on August 1, 2023 - remain valid until their listed expiration dates, in 2026 and 2027, respectively.

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You can find the new forms here. 

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State Updates

Tennessee: As of April 11, 2025, employers in Tennessee are required to pay out all owed earnings in the event of an employee’s death. Previously, Tennessee employers could cap those payments at $10,000. You can read more here. 

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Washington: Beginning June 27, 2025, employees in Washington state will be permitted to use sick leave in order to address immigration-related issues. You can read more here.

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The Washington state legislature has also updated several laws governing when minors are allowed to work, employee protections, health care worker rest breaks, and workplace safety measures in certain industries. You can find those bills here, here, here, and here, respectively.

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Beginning July 27, 2025, Washington employers will no longer be able to require that employees have driver’s licenses unless driving is part of the job function and/or central to a legitimate business purpose. You can read more here.

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As of May 1, 2025, minimum wage in the city of Bellingham, Washington increased to $18.66 per hour. You can read more here. 

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Wisconsin: The Wisconsin Supreme Court ruled that state laws that protect job candidates and workers from arrest-record discrimination also apply to non-criminal offenses like civil violations. You can read more here. 

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Colorado: Beginning July 1, 2025, Colorado employers that collect biometric data (e.g. fingerprints, retina scans, etc.) from employees and/or job candidates must follow the expanded guidelines laid out in the Colorado Privacy Act, which include implementing a written policy addressing biometric collection protocol and obtaining consent for the collection of biometric data. You can read more here. 

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Beginning February 1, 2026 Colorado employers that use artificial intelligence to evaluate employees and job applicants will be required to take proactive measures to ensure that those platforms are not enabling discriminatory practices. You can read more here.

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Massachusetts: Employers with more than 50 employees must post the new veterans services poster that was just released by the Massachusett Executive Office of Labor and Workforce Development. The poster must be conspicuously displayed in an area that is accessible to all employees. You can find the poster here. 

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New York: As of  March 2, 2025, all New York employers are prohibited from requiring job applicants to provide a copy of their criminal history record, which closes a loophole employers had been exploiting to obtain such records despite restrictions regulating their access to those records.

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As of March 22, 2025, all New York employers regardless of size are prohibited from requiring job applicants or employees from providing a copy of their criminal history report that was obtained via the New York State Division of Criminal Justice Services. 

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Beginning May 8, 2025, NY employers with more than 3 employees must conspicuously post their lactation room accommodation policies and guidelines as well as the relevant state requirements both somewhere accessible by all employees and on the organization's intranet if applicable.

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Beginning June 2, 2025, employers with 10 or more retail employees must have in place a written policy and training program for violence prevention measures and retail employers with 500 or more employees must install and/or maintain silent response buttons to alert authorities about emergencies. This legislation was originally slated to take effect March 4, 2025, But was amended to clarify employer responsibilities.

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Further, as of January 1, 2025, New York employers are required to provide 20 hours of paid prenatal leave during a 52 week period. Also, as of the new year, the characteristics to which equal protection was extended via the New York State Human Rights Law and the resulting protections are formally enshrined in the New York State Constitution. Those characteristics include: age, disability, ethnicity, gender identity, gender expression, national origin, pregnancy, and anything else related to reproductive healthcare.

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Oregon: As of January 1, 2025, Paid Leave Oregon provides leave for employees completing necessary legal steps associated with adopting and/or fostering children.

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Minimum Wage For Federal Contractors Rescinded

On March 14, President Trump rescinded Executive Order 14026 - which Biden signed in 2021 and raised the minimum wage for federal contractors from $10.10 per hour to $15 per hour with mechanisms contained within the order to continue increasing this wage minimum over time. 

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On January 1, 2025, in accordance with EO 14026, the minimum wage for federal contractors increased to $17.75 per hour, but now that Trump has rescinded EO 14026, it is unclear what the current minimum wage for federal contractors is.

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You can read more here.

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Alternative Manner For 1095-B & 1095-C Distribution

If your organization is using the alternative method for distributing 1095-B and 1095-C forms in accordance with the Paperwork Burden Reduction Act, your website must be in compliance from the first business day of March through at least October 15th. You can find guidance from the IRS about how to properly follow compliance protocols here.

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DEI Executive Orders Paused

On February 21, 2025, a federal judge put a stay on Trump’s Executive Order limiting the ability of federal agencies and federal contractors to operate Diversity Equity and Inclusion programs. The court questioned whether the order violated free speech rights and potentially illegally restricted otherwise legal actions taken by private entities. You can find the decision here. 

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Form 300A Submission Due

From February 1st to April 30th, non-exempt (low hazard) employers who had at least 11 employees at some point in 2024 must post in a conspicuous place a copy of OSHA Form 300A, Summary of Work-Related Illness and Injury, certified by a company executive.

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For non-exempt employers that had 250 or more employees at some point last year and employers with 20 or more employees in specified high risk industries, OSHA requires electronic submissions, which are due by March 2nd, 2025. 

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You can find the electronic submission platform here. 

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Executive Orders

In his first days since returning to office, President Trump signed a series of executive orders dealing with labor and employment issues for federal employees and federal contractors, with more expected still to come.

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While thus far these orders don’t apply to private employers in general - with the exception of those that accept federal funds and/or are federal contractors - these orders will not only affect a sizeable portion of the workforce directly, but they will also likely inspire some private employers to modify their practices and follow the example set by the executive branch.

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The new rule that will most likely have the largest impact beyond the sphere of federal employees is Executive Order 11246, which makes it so that federal contractors no longer have to practice affirmative action in the hiring process for most protected classes. The only protected classes excepted from the order are veterans and individuals with disabilities, for whom affirmative action standards still apply. 

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Although federal contractors will no longer be required to maintain affirmative action programs, Title VII of the Civil Rights Act remains in effect to prevent discrimination against protected classes like race, gender, sexual orientation, and national identity. 

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You can read more here

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Spence v. American Airlines

A Federal District Court Judge in Northern Texas ruled that American Airlines had breached its fiduciary duty by working with an investment manager that promoted ESG practices in a way that ran counter to the economic interests of the employee retirement fund beneficiaries.

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The repercussions of this ruling could be industry-reshaping if upheld, although there were many additional conflicts of interest between American Airlines and their investment fund manager that may limit how broadly applicable the ruling will ultimately prove to be.

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The judge has already found American Airlines in breach of their fiduciary duty, but he has yet to assess damages, which will influence the probability of appeal and the likelihood of copycat cases.

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You can read more about this case here.

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EAD Extension Formalized

As of January 13, 2025, the extension period for certain renewal Employee Authorization Document (EAD) applications filed on May 4, 2022 or later has been formalized at 540 days.

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You can read more here.

IRS Mileage Reimbursement Rate Increased

As of January 1, 2025, the IRS mileage reimbursement rate for road miles driven for business purposes increased by 3 cents per mile from 67 to 70 cents per mile driven. 

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PCORI Fee Increase

The IRS released a statement announcing a 25-cent increase in Patient-Centered Outcomes Research Institute fees for covered plan years ending on or after October 1, 2024, and before October 1, 2025. 

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The new fee is $3.47 per covered life.

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You can read more here. 

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DOL Reinstates Simplified Tip Credit Rule

In response to a Federal Court of Appeals Decision that vacated the so-called 80/20/30 rule that was instituted in 2021, the Department of Labor officially reverted to the previous tip credit rule.

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You can read more here.

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Increased ACA Flexibility and Affordability Threshold

In the final days before Christmas a few weeks ago, the Employer Reporting Improvement Act both became law. 

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As of January 1, 2025, the threshold for what qualifies as affordable coverage is now 9.02%, which means that an employee’s required contribution to the plan can be no more than 9.02% of their salary in order for the plan to be considered affordable and to avoid potentially paying the penalty. 

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You can read more about the affordability threshold here.

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EAP & Highly Compensated Exception Update

A federal court in Texas determined that the Department of Labor exceeded its authority last summer by increasing the minimum pay thresholds for employees to qualify under the executive, administrative, and professional and highly-compensated employee exceptions to minimum wage and overtime protections. 

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Those minimum pay thresholds have reverted to their prior levels - back to $684 per week for the EAP exemption (down from $844 per week under the now defunct rule), and back to $107,432 per year for the HCE exemption (down from $132,964 per year under the now defunct rule). 

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NLRB Says No Captive Audience Meetings on Unionization Issues

The National Labor Relations Board has issued a decision prohibiting employers from forcing employees under threat of punishment to attend meetings during which the employer will share views on unionization or its impacts. 

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Employers are allowed, however, to convene employees and share their views on unionization and potential impacts so long as employees are not disciplined or adversely affected in any way for not attending (or leaving early). Employers should not even keep or maintain such attendance records.

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You can read more here.

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IRS Publishes 2025 Annual Retirement Plan Maximums

• The 401(k) annual contribution limit increased from $23,000 to $23,500 in 2025.
• The catch-up contribution limit stayed unchanged at $7,500 for participants aged 50 and over.
• The SECURE Act 2.0 also instituted a new type of catch-up contribution, which enables participating people (age 60 to 63) to contribute up to $11,250 annually.

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You can read more here. 

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IRS Publishes 2025 Annual Benefit Maximums

• The HFSA contribution max is $3,300 (maximum carryover is $650 for HFSAs with carryover features).
• The QSEHRA max for total reimbursements is $6,350 for single coverage and $12,800 for family coverage.
• The max employee tax credit for adoption assistance is $17,280, with additional conditions depending on employee salary range. 
• The monthly parking and mass transit benefit max is $325. 

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You can find the complete IRS 2025 benefit contribution limit list here.

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ERISA Guidance for Long-Term Part-Time Employees

You can find guidance for ERISA 403(b) plan eligibility requirements for long-term, part-time employees according to the updated standards from the Secure ACT 2.0 here.