UPDATE: Major corporations are significantly scaling back gym and wellness benefits for employees as economic pressures mount. A new report from Ramp Capital reveals that spending on wellness benefits will plummet from an average of $1,366 per employee in 2023 to just $1,103 in 2025, marking a staggering 20% decrease.
The shift in corporate wellness strategies comes as companies grapple with soaring healthcare costs and an uncertain economic landscape. With annual family premiums for employer insurance coverage nearing $27,000, and projected to hit $30,000 this year, employers are re-evaluating the return on investment of wellness programs.
While many organizations previously embraced lavish perks to attract talent, the focus is now on cost-effective options. Employers are scrutinizing which wellness benefits are actually utilized by employees, often opting for lower-cost alternatives. For instance, companies are favoring budget-friendly gyms like Planet Fitness over pricier options like Equinox.
According to Josh Bersin, CEO of The Josh Bersin Company, “I don’t hear companies saying, ‘Our well-being program has been our secret to success.'” The lack of measurable returns on wellness investments has led many firms to question the value of these programs.
Data from Ramp Capital indicates that employees are increasingly turning to affordable wellness apps such as ClassPass and Wellhub, signaling a shift in how workers are accessing fitness resources. As employers cut back on wellness spending, the focus is shifting to services that deliver tangible benefits without straining budgets.
The MetLife survey underscores this trend, revealing that controlling healthcare costs is now the primary objective for employers, surpassing goals of productivity and talent retention. Todd Katz, head of US group benefits at MetLife, emphasized that companies are evaluating every benefit in light of rising healthcare expenditures.
As organizations pivot to a more strategic approach, they are employing data to determine which wellness offerings are effective. New platforms that track employee engagement are providing insights into which benefits are truly beneficial, allowing companies to adjust their offerings accordingly.
However, the reduction in wellness perks may not sit well with all employees. As stress and burnout levels rise, many workers are questioning the effectiveness of quick-fix solutions like wellness apps, especially when they feel overwhelmed by their workloads. A 2024 study from Oxford University found that many wellness initiatives, including relaxation classes and financial coaching, have not significantly improved employee well-being.
In this changing landscape, the emphasis is on creating a genuinely supportive workplace culture rather than merely offering superficial benefits. As Zachary Chertok from IDC notes, “The way to build a healthy workplace culture is for the workplace to be holistically healthy.”
As companies navigate these turbulent times, the future of corporate wellness programs remains uncertain. Will employers continue to invest in wellness initiatives, or will they prioritize other areas of business? Only time will tell.
Stay tuned for more updates on this developing story as businesses adapt to the evolving landscape of employee benefits.
