Each month, Mployer Advisor breaks down the Bureau of Labor Statistics’ most recent State Employment and Unemployment Summary to highlight some employment trends across various markets. This is an overview of March’s report.
Editor's Note: This report is based on survey data from February 2025 that was published in March 2025. This is the most recent data available. (Source: Bureau of Labor Statistics)
For two straight months now, US employers have added about 150 thousand new jobs according to initial reports, which is down slightly from the approximate 170 thousand new jobs added monthly over the past year, but not too far off track.
Despite those new payroll entries - only 3 states experienced net growth in total in-state jobs over the month, while the remaining 47 and Washington DC saw no significant change in payroll size.
The national unemployment rate ticked up one-tenth of a percentage point to 4.1%, but Florida was the only state that individually recorded a significant change in unemployment, climbing from 4.5% to 4.6% over the month.
Below is the breakdown of the Bureau of Labor Statistics’ (BLS) market employment summary from the March 2025 report.
States With the Highest Unemployment Rates
Nevada had the highest unemployment rate for the 4th month in a row, holding steady over the month at 5.8%.
California, Michigan, and Washington DC had the next highest unemployment rates at 5.4% each, followed by Kentucky at 5.3%, with Illinois at 4.8% rounding out the only 6 states with unemployment rates above the national average of 4.1%.
Florida was the only state to see an increase in unemployment rate over the last month, but over the course of the last 12 months, 30 months have seen unemployment rise, with the largest increases recorded by Michigan (plus 1.4%), Mississippi (plus 1.0%), and Colorado (plus 0.8%).
States With The Lowest Unemployment Rates
South Dakota - holding steady over the month at 1.9% unemployment - continued its streak of claiming the lowest unemployment rate in the country, which now stretches to 14 months.
North Dakota and Vermont shared the next lowest unemployment rate - both holding steady over the month at 2.6% - followed by Nebrask, New Hampshire, and Hawaii at 3%.
In total last month, 18 states had unemployment rates meaningfully lower than the US average of 4.1%.
Over the last 12 months, 30 states have recorded an increase in unemployment.
States With New Job Losses
No state recorded significant net job losses over the last month or over the last year.
States With New Job Gains
Missouri, New Jersey, and Ohio were the only states that recorded a net increase in payroll figures last month, growing by 0.4% each, amounting to increases of about 13 thousand, 19 thousand, and 23 thousand jobs, respectively.
Over the last 12 months, 17 states in total have recorded net job additions. The largest proportional gain was recorded in Idaho, which increased its workforce by 2.7% over that time frame, followed by South Carolina and Utah at plus 2% each.
Texas, Florida, and New York had the largest raw number of job gains over the past year at about 14 million, 10 million, and 10 million, respectively.
Mployer’s Take
This market summary represents a positive improvement over last month’s market summary which showed month-to-month net job losses across several states.
That said, while this data comes from the first full month of the second Trump administration, the economic impacts that will result from the policy changes that accompanied the transfer of power have not yet become apparent in these labor market reports.
It is difficult to pinpoint exactly how many federal workers have been laid off, which some observers claim added up to more than 60 thousand in February alone while the Department of Government Efficiency itself claims that figure is much smaller when voluntary retirements and resignations are taken into account.
Even less clear are the number of tangential private sector workers whose work is supported by federal employees and/or federal funding that may now be less available and/or less effective than it was in the past, so the secondary effects of federal workforce funding cuts are even further from having worked down the pipeline.
As a result, the holding pattern continues, and will likely continue for at least another couple of months as Trump wraps up the first 100 days of his second term in April - the period during which president’s are often most productive in executing their agendas.
Of course, there is no set deadline at which point the outcomes of these actions will be ultimately evaluated, and the effectiveness of some of those actions may well be a point of differing opinion well into the future.
But the early signs and indications about some of the near-term effects we can reasonably expect from the policy changes that have already been implemented may start to appear in the data as early as next month.
Each month, Mployer Advisor breaks down the Bureau of Labor Statistics’ most recent State Employment and Unemployment Summary to highlight some employment trends across various markets. This is an overview of January’s report.
Editor's Note: This report is based on survey data from December 2024 that was published in January 2025. This is the most recent data available. (Source: Bureau of Labor Statistics)
Despite the expectation-exceeding quarter of a million net jobs added last month across the US, unemployment actually increased in 6 states and only decreased in 2 states, with the remaining 42 states and Washington DC showing no significant movement in either direction.
Payroll figures were even more steady month-to-month, with 48 states and DC seeing almost no change in payroll during December while only 2 states saw a net increase in payroll figures.
Below is the breakdown of the Bureau of Labor Statistics’ (BLS) market employment summary for January 2025.
States With the Highest Unemployment Rates
Nevada had the highest unemployment rate for the second consecutive month, holding steady at 5.7%, followed by California and Washington DC at 5.5%, Kentucky and Illinois at 5.2%, and Michigan at 5.0% unemployment.
All other states have unemployment rates that are at or below the national average of 4.1%
Mississippi and Alabama had the largest jumps in unemployment rate last month - both climbing from 3.1% to 3.3%. Colorado, Maine, Massachusetts, and Pennsylvania each saw their state unemployment rate climb by 0.1%, as well.
Over the last year, 28 states in total have recorded an increase in unemployment rate, with the steepest rises occurring in South Carolina (1.7%), Rhode Island (1.2%), Colorado (1.1%), and Indiana and Kansas at 1.1% each.
States With The Lowest Unemployment Rates
South Dakota has maintained the lowest unemployment rate in the country for the last 12 months in a row, staying consistently at 1.9% unemployment for the last 3 months.
Vermont has the next lowest unemployment rate at 2.4% followed by North Dakota at 2.5%.
In total, 21 states have employment rates below the US average of 4.1%.
Only 2 states recorded a decrease in unemployment over the last month - Minnesota, which saw its unemployment rate drop from 5.5% to 5.3%, and Montana, which saw its unemployment rate fall by 0.1% from 3.2% to 3.1%.
Over the last 12 months, 6 states in total have seen net unemployment rate reductions, led by Connecticut, which saw its unemployment rate decrease by 1.2% over the year, followed by Wisconsin and Arizona at minus 0.4% each.
States With New Job Losses
No state recorded net job losses over the last month or the last year.
States With New Job Gains
Texas and Missouri were the only states that had a net increase in payroll last month, adding about 37 thousand and 11 thousand jobs respectively.
Over the last year, 33 states have seen an increase in their payroll figures, with Texas and California reporting the largest number of net jobs added while Idaho had the largest percentage increase in payroll figures at plus 3.6%, followed by Missouri and South Carolina at 2.8% each.
Mployer’s Take
Despite the downtick in the unemployment rate and huge over-performance of jobs reflected in this month’s Employment Situation release, there was relatively little evidence of those gains seen in the states, which were a model of stability nearly across the board.
Data from different labor surveys can and will often lead to results that don’t necessarily align, and that appears to be the case here.
Next month might provide some additional context that may help better interpret the disconnect between employment reports showing growth and those showing stability, but next month’s report will cover data collected on both sides of the transition from one session of Congress and one presidential administration to the next.
Whether there is much insight yet to be obtained about economic data at the close of the previous term will quickly become overshadowed by the potential economic implications of new policies that are proposed and enacted over these first few months of 2025.
With a flurry of activity both at the federal and state level already, including both legislation and executive orders that carry significant economic implications, that’s where we’ll be keeping an eye out in the months ahead as the economic and workforce impacts take shape.
The latest economic release from the Bureau of Labor Statistics reports that the U.S. job market exceeded expectations by a significant margin to close out 2024, adding 256 thousand new jobs last month while unemployment ticked down one-tenth of a point to 4.1%.
Editor's Note: This report is based on survey data from December 2024 that was published in January 2025. This is the most recent data available. (Source: Bureau of Labor Statistics)
US employers added about 256 thousand jobs last month, which exceeded economists predictions of about 150 thousand jobs by nearly 79%.
The national unemployment dropping to 4.1% also bet forecasts, which were predicting the national unemployment rate from holding steady at 4.2%.
The number of people who permanently lost their job last month was down significantly from the month prior as well, down from almost 1.9 million people in November prior to 1.7 million as of the latest report.
There wasn’t much change in terms of the number of long-term unemployed and the labor force participation rate, which held steady at 1.6 million and 62.5%, respectively.
People working part time due to economic reasons (4.4 million) and people who want a job but haven’t looked for one in the last 4 weeks (5.5 million) also was similarly unchanged over the month, as was the 1.6 million people who are categorized as marginally attached to the workforce, meaning they want a job and had looked for one at some point in the past 12 months but had not done so in the past 4 weeks.
Of the net 256 thousand net new payroll entries over the course of December, the healthcare industry was responsible for the largest portion at 46 thousand new jobs, with the retail industry close behind at 45 thousand net new jobs after suffering a net job loss in November’ report.
About 33 thousand and 23 thousand government and social assistance jobs were added last month, as well, while most of the remaining industries saw little change in payroll figures during the month, including leisure & hospitality, natural resource extraction, construction, manufacturing, wholesale trade, information, financial activities, and professional and business services as well as other services.
Average hourly pay continued rising, this time by about 10 cents to $35.69 per hour (an increase of 0.3%), while the average workweek held steady at 34.3 hours per week.
Mployer’s Take
This latest employment report marks the second consecutive month of job growth that far outpaces expectations, but those two strong months come on the heels of an especially weak one in October.
Still, given that strikes, natural disasters, and related data collection issues were significantly responsible for the down month, the two latest strong months look all the better by comparison.
The recent job market strength, however, bolsters the Federal Reserve’s case for delaying additional rate cuts and makes it very unlikely that we’ll see any rate cuts over the next several months, especially in light of uncertainty about whether the incoming Trump administration will follow through with tariffs and if so, how broadly impactful they may be, which the Fed will monitor closely in relation to any inflationary pressure the tariffs may cause.
While we won’t know much more about how the months and years ahead are primed to play out until power formally changes hands, it’s worth taking a look at some of the milestones from the past year as we wrap up some of the last data points from 2024.
Over the last year, US payrolls have increased by 2.2 million, for an average monthly net job gain of 186 thousand. Unemployment is up three-tenths of a point from a year ago, while average hourly wages are up almost 4%.
Other than comparing last year to 2023, when more than 3 million net jobs were added for an average monthly increase of more than a quarter million, it is hard to look at the 2024 numbers and not be impressed at the strength and resiliency of the labor market and economy generally throughout the year.
With the new year comes new data, new milestones to mark, and in this case, new policies that will shape the labor market and economy going forward for years to come, but overperformance has become the new normal over the past several years, even when plenty of economists were expecting economic downturn, and overperformance is almost certainly unsustainable in the long run as expectations adjust to correct for previous errors.
We would be lucky to keep up the streak, to be sure, but regardless, we will continue keeping an eye on the labor market and economy as new developments come about.
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.
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.
EAD Extension Formalized
Beginning on January 13, 2025, the extension period for certain renewal Employee Authorization Document (EAD) applications filed on May 4, 2022 or later is now formalized at 540 days.
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.
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.
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.
The former will provide an alternative means for employers to distribute forms 1095-B and 1095-C to employees, and the latter extends the time employers have to respond to IRS notice of audit 226-J forms from 30 days to 90 days.
In 2025, the threshold for what qualifies as affordable coverage also increases from 8.39% to 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.
You can read more about the affordability threshold here.
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.
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).
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.
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.
Colorado: The City of Boulder increased the minimum wage to $15.57 ($12.55 for tipped employees) as of January 1, 2025.
Oregon: As of January 1, 2025, Paid Leave Oregon provides leave for employees completing necessary legal steps associated with adopting and/or fostering children.
New York: New York employers that receive criminal history records for applicants and employees must now provide those applicants and employees with a copy of those records and a copy of the applicable New York corrections law as well as an opportunity to correct any inaccurate information that may be contained in those records.
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.
IRS Publishes 2025 Annual Retirement Plan Maximums
The 401(k) annual contribution limit increases from $23,000 to $23,500.
The catch-up contribution limit stays 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.
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.
You can find the complete IRS 2025 benefit contribution limit list here.
Minimum Wage Increases for Federal Contractors
As of January 1, 2025, the minimum wage for work conducted in association with federal contracts covered by Executive Order 13658 is $13.30 ($9.30 for tipped employees), while the minimum wage paid for work conducted in association with federal contracts covered by Executive Order 14026 is $17.75 per hour for both tipped and non-tipped employees.
Additional guidance about which kinds of contracts are covered by which executive order can be found here.
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.
Each month, Mployer Advisor breaks down the Bureau of Labor Statistics’ most recent State Employment and Unemployment Summary to highlight some employment trends across various markets. This is an overview of December’s report.
Editor's Note: This report is based on survey data from November 2024 that was published in December 2024. This is the most recent data available. (Source: Bureau of Labor Statistics)
Last month, the national unemployment rate rose to 4.2% (up one-tenth of a percentage point), but only 6 states saw their state-level unemployment go up while one state saw a decrease in unemployment and all the rest saw no significant change in state employment levels.
US employers added more than a quarter of a million jobs at the same time, but only 4 states plus Washington DC recorded a net increase in payroll figures, while the remaining 46 states saw no noteworthy change over the month.
Below is the breakdown of the Bureau of Labor Statistics’ (BLS) market employment summary for October 2024.
States With the Highest Unemployment Rates
Nevada had the highest unemployment rate last month at 5.7%, which is up almost one-tenth of a point over the month and about four-tenths of a point over the last year.
Washington DC has the next highest unemployment rate at 5.6%, followed by California at 5.4% and Illinois at 5.3% unemployment.
Those are the only states that currently have unemployment rates above the national average of 4.2%, with Idaho having the next highest unemployment rate at 3.7%.
Last month, 6 states recorded a higher unemployment rate than the month before, led by Alabama, Maine, and Mississippi, which all saw their unemployment rates climb from 2.9% to 3.1% over the course of the month. Iowa (now 3.1%), Kansas (now 3.5%), and Vermont (now 2.4%) all saw the unemployment rates in their states increase by 0.1%.
Over the last year, 26 states have experienced rising unemployment, with the largest percentage increases going to South Carolina (plus 1.8%), Rhode Island (plus 1.4%), and Colorado (plus 1.0%).
States With The Lowest Unemployment Rates
South Dakota is now 1 month shy of hitting the 1-year mark of consecutive months with the lowest unemployment rate among states - this month holding steady month-to-month at 1.9%.
The next lowest unemployment rate was 2.4% - recorded by both North Dakota and Vermont - which is more than half of a percentage point above South Dakota’s level, which further reinforces just how strong South Dakota’s labor market has been.
Delaware was the only state that experienced a net reduction in unemployment over the month, dropping one-tenth of a point from 4.0% to 3.9%.
Over the last 12 months, 6 states have recorded a net decrease in unemployment, but the largest reduction by far occurred in Connecticut where unemployment fell by 1.2% over the last year, followed by Wisconsin and Arizona, which each fell by only half a point each.
States With New Job Losses
No state recorded net job losses over the last month or the last year.
States With New Job Gains
Employers in the state of Florida added more net jobs last month than any other state, increasing payrolls by more than 60 thousand, while Washington state had the next largest gain, adding a little more than 30 thousand net jobs over the month.
Washington also had the largest percentage gain, increasing their workforce by 0.9%, followed by Alaska and Washington DC at 0.7% each, Florida at 0.6%, and Kansas at plus 0.5%.
Over the last year, 33 states have recorded statistically significant increases in net jobs.
Texas and California had the largest net increase in raw job figures at about 274 thousand and 208 thousand, respectively, while Idaho had the largest percentage growth (3.1%) followed by Alaska (2.8%), Missouri (2.7%), and Montana (2.4%).
Mployer’s Take
Not much has changed on the surface, but several external factors are in flux that could significantly shift the economic outlook over the coming months (and years) depending upon how they resolve.
The current report is the third to last such dataset that will be compiled by the outgoing Biden administration, and there are still a number of uncertainties that remain about the priorities of the incoming administration and how the transfer of power will impact the economy and labor market, both in the short and long term.
While Congress was able to avert a government shutdown at the end of last week by passing a last-minute continuing resolution, that bill will only keep the government funded for a couple of months through the middle of March when Republicans will control all 3 branches of the federal government, and how they elect to respond to current inter and intra party disputes will have significant ramifications outside of DC, of course.
The end of last week also brought another quarter-point interest rate cut from the Federal Reserve, but that news wasn’t entirely well-received given that it was accompanied by statements from Fed Chair Jerome Powell indicating the Fed will probably only cut another half point from interest rates over the course of 2025, which is half of what many analysts were expecting.
The stock market ended the week on an upturn due to better-than-expected inflation data, but that upturn followed nearly 2 weeks of consecutive losses punctuated by an almost 3% drop on the day of the Fed’s announcement, and while the markets are up close to 10% over the last 6 months, they are down more than 2% over the week/month.
While there are certainly many questions up in the air about how the economic road ahead will unfold, we are unlikely to get many meaningful answers for at least another month and likely more.
The latest economic release from the Bureau of Labor Statistics reports that the U.S. job market rebounded after a sluggish month in October to add 227 thousand new jobs last month as the unemployment rate ticked up slightly to 4.2%.
Editor's Note: This report is based on survey data from November 2024 that was published in December 2024. This is the most recent data available. (Source: Bureau of Labor Statistics)
The national unemployment rate average ticked up one-tenth of a point to 4.2% last month as US employers added 227 thousand jobs, outpacing the approximate 200 thousand jobs that economists were predicting.
The number of unemployed people held comparably steady at about 7.1 million, as well, with about 1.7 million (17%) qualifying as long-term unemployed. The number of unemployed people has risen by around 800 thousand over the last 12 months, while the number of long-term unemployed has risen by about 500 thousand over the same time period.
Those figures, however, do not account for the nearly 5.5 million people who are not counted as unemployed because they have not been actively looking for work in the past 4 weeks.
Also, it’s worth noting that about 4.5 million people are currently employed part time for economic reasons, which is up from about 4 million people who fell into that category a year ago.
Altogether, the figures show general resilience and a strong rebound from last month’s hurricane and strike-induced dip, but the full economic picture is not entirely sunny, and evidence of some softening in the labor market persists.
That said, there’s not much of said evidence to be found in the jobs numbers, however, with 227 net new payroll entries over the month, but it could be argued that the concentration of new jobs across a relatively few industries is less than ideal.
For example, the healthcare industry and leisure & hospitality industry each added about 54 thousand net jobs, which collectively account for nearly half of the total job additions last month. Further, both the healthcare and leisure & hospitality job figures last month were essentially on par with their monthly averages, meaning that last month’s payroll additions were essentially right on the trendline.
Employment figures in government and transportation equipment manufacturing each rose by about a little over 30 thousand jobs, while the social assistance industry saw a net addition of about 20 thousand jobs.
There was little to no noteworthy change in the other industries with the exception of the retail industry which saw a net loss of nearly 30 thousand jobs over the course of November.
Average hourly pay continued its general upward trend climbing 13 cents to $35.61 per hour while the average workweek climbed one-tenth of an hour to 34.3 hours per week.
Average hourly pay is up 4% over the last 12 months.
Mployer’s Take
In light of this most recent batch of economic data, last month’s report of only 12 thousand new jobs looks more like an outlier than evidence of a rapid cooling in the job market.
Although the upward revision to last month’s numbers of about 36 thousand jobs could look huge by some measures (plus 200% upward revision) or fairly insignificant by others (post-revision new payroll entries in October were still only about 25% of the average 186 thousand new jobs added each month over the last 12), the reality is that last month’s performance reflected hurricane and strike related data aberrations more than changing macroeconomic conditions.
Despite this positive jobs report, markets have not been dissuaded from believing another interest rate cut is likely in store when Federal Reserve leadership convenes again later this month.
Still, the outlook is not entirely positive across the board, with a decreasing number in job postings across nearly every industry, for example, indicating the job market is expected to continue cooling - which is in part why continued rate cuts are forecast.
What likely matters more at the moment than the bigger picture environmental factors that are shaping the current economic trends, however, are the political and regulatory factors that will begin impacting the labor market and US/world economies in general when control of the White House and US senate changes hands in the new year.
Even with Republicans in control of all 3 branches of the federal government, there remains a great deal of uncertainty both about which proposals they will pursue and prioritize, many of which can have significant impacts to the economy and labor force (e.g. tariffs, taxes, collective bargaining legislation).
That lack of clarity will begin coming into focus in 2025.
We are excited to announce the launch of Insights+, a service that enables employers to see exactly how their benefits measure up against the competition.
Insights+ is the next evolution in employee benefits evaluation and benefits value-capture tools.
Employee benefits are a major factor that influence whether employees choose to change jobs or stay with their current employer, and employers invest millions a year into their benefits programs - yet - employers often have no easy way to show their employees that they have “good benefits” in a way that is meaningful to employees.
Based on your feedback, we have developed a new solution designed to fix this very problem.
As the industry leader in employee benefits benchmarking, we had the necessary data, technology, and market-positioning to create this first-of-its-kind way for employers not only to see how their benefits compare with other employers just like them, but also to share that information directly with employees and recruits via customized informational materials that provide independent verification of the real value contained in the benefits your organization is offering.
ARTICLE |Do Your Employee Benefits Make The Grade?
We are excited to announce the launch of Insights+, a service that enables employers to see exactly how their benefits measure up against the competition.
AND as a special incentive for newsletter subscribers and early adopters, we are offering this new service at no cost for qualifying who apply through the remainder of 2024.
Click here to see if you qualify for the free Insights+ early adopter opportunity!
How Insights+ Works
All we need from you is the employee benefits guide that you provide to employees. That’s it. If you don’t have an employee benefits guide, just fill out a short questionnaire.
From there, we analyze the information you provide (which will remain confidential at all times, of course) across a variety of dimensions (e.g. health, financial, tangential, leave) and then provide a detailed, 25+ page report summarizing how your benefit offerings stack up against various cohorts of similarly sized and situated competitor organizations compiled from our database of more than 20 thousand employers.
We also provide badges and ready-for-distribution, customized informational materials that can be shared with recruits and employees in order to convey the value of the benefits your organization offers, which the average employee currently underestimates by more than 50%. That amounts to an average of about $12,000 in benefit value per employee per year that employers are providing but that employees are not perceiving.
Click here for a free 15 minute consultation to find out if your organization qualifies for the free Insights+ report available through December 31, 2024.
Why Insights+ Works
With an independent evaluation of their benefits offerings from a non-biased third-party, employers can better benchmark their offerings relative to other similar employers that are competing to attract similar talent.
Employers can also then better adjust those offerings to more finely target the ideal workforce segment, and better convey the value of those benefits in a way that gives both current employees and job applicants a consistent, objective, and independent means to compare benefits on equal footing across different companies.
Employee Benefits Have Significant Value…When Employees And Applicants Know About Them and Understand That Value
As we have noted many times on these pages, offering great employee benefits can be a significant advantage for employers on a number of different fronts - including improved productivity, operational continuity, and mission/incentive alignment for example - but employee attraction and retention may be the most widely-cited sources of return on investment for employers when it comes to recouping benefit expenses.
Benefits only serve to help retain current talent if the talent has a practical understanding of the value those benefits provide, however, and employers are often even less effective in realizing the recruiting advantages that offering exceptional employee benefits can provide.
As a part of the 2024 Mployer Insights survey, we collected data from employees at more than 20,000 companies to illuminate the disconnect in benefits information/communication between employers and prospective employees, and we found that this disconnect is massively disadvantageous to employers who offer market competitive benefits or better but don’t fully capture the value of those benefits when attracting and competing for the best available talent.
The Benefits-Information/Communication Gap
According to our survey, the top two factors that are most influential to both current and prospective employees when evaluating jobs are compensation and benefits, cited as top concerns by 79% and & 76% of respondents, respectively, which far outweigh other leading influential factors such as organizational culture (54%) and getting along with management (59%) and leadership (51%).
In fact, the opportunity to obtain better benefits alone can potentially motivate employees to seek out new employment, with nearly 3 out of 4 respondents claiming that they’d change jobs in order to obtain a more flexible work schedule such as hybrid and/or remote work options. About half of all respondents would accept a new job if the prospective employer offered better 401k terms and offered health insurance that covered more employee medical costs, as well.
In order to intentionally pursue opportunities with better benefits, however, employees need to have both an accurate understanding of the value of the benefits offered by their current employer as well as an accurate understanding of the value of benefits offered by potential prospective employers, in addition to an objective means to compare and evaluate those benefits options across companies - all of which relies on getting information that is often difficult if not impossible to obtain.
Despite increasingly recognizing the potential value of benefits in general, employees often don’t have a particularly detailed grasp of the benefits offered at their current place of employment. For example, about 1 in 5 survey respondents think their employers cover between 0% and 20% of their healthcare costs, while another 1 in 5 respondents estimate that their employers cover between 60% and 80% of employee healthcare costs, which is a fairly wide spread.
It can be even more challenging to get detailed, actionable, and objective information from prospective employers that can facilitate benefit package comparison across multiple organizations during the job search and pre-employment stages of recruiting.
Among survey respondents, fewer than 1 in 5 (19%) claimed that they had an easy way to compare the value of benefits among different employers during their last job search, while nearly half of respondents (47%) claimed they did not have an easy way to make such comparisons.
With 88% of job seekers looking for information about benefits as a part of the job search, and with only 22% of companies providing that information to candidates during recruitment, there is a considerable opportunity for employers that offer average and better benefits packages to differentiate themselves from the competition by more clearly conveying the relative value of the benefits they are already offering.
Overcoming the Benefits-Information/Communication Gap
The vast majority of employees support greater transparency in how and when benefits information is conveyed, with almost 9 out of 10 respondents favoring greater transparency from both prospective and current employers with regard to the benefits they offer as well as how those benefits compare to the benefits offered by competitors.
Similarly, about 9 out of 10 respondents also claimed they would be more likely to apply for a job at a prospective employer if that employer is more transparent upfront about the benefits they are offering.
In light of this consistent supermajority favoring benefits transparency, it is perhaps unsurprising that the number of respondents who are more likely to accept a job at a company that had received an award for providing great benefits is once again 9 out of 10.
Bridging these gaps is where Insights + provides such a benefit to employees and recruits beyond simply helping employers better understand and capture the value that their benefits expenses should be generating.
Mployer’s Take
We are extremely excited about the opportunity the new Insights+ service has to positively impact both employers as well as current and prospective employees - especially those who prioritize quality benefit offerings.
Employers that already offer quality benefits packages may be the most direct beneficiaries of the program, which will better enable them to promote the work that they have already put in to keep their organization ahead of the curve.
It’s worth making a point to note, however, that the data that serves as the basis for these reports may be equally if not more valuable to employers who haven’t yet been prioritizing the competitiveness of their employee benefits offerings.
For those employers whose benefits are below average relative to their competitors, the program and accompanying analysis offer an opportunity to pinpoint not only the areas in which current benefits fall short, but the report will also indicate the percentile margin by which the offerings are subpar for the job/industry/region. Even for organizations that aren’t interested in improving benefits offerings, quantifying and benchmarking benefits in this way can be helpful to identify and more cost-effectively target the subset of the labor pool whose expectations are in line with your offerings.
Regardless of the degree to which one currently prioritizes benefit quality, we believe this program represents a significant step toward increased transparency, objectivity, and information access that will serve employers and employees alike, resulting in faster hiring and longer retention at lower net costs to everyone's mutual benefit.
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