Employers Prioritize Financial, Retirement Goals as Generations Shift Focus
Employers who scaled back on benefits following the COVID pandemic have fully recovered their workplace benefits strategy and plan to continue improving financial and retirement benefit packages, claims new findings out from Newport, an Ascensus company.
Research from the 2025-2026 Compensation, Retirement, and Benefits Trends Report surveyed 594 U.S. employers across 16 industries and found that a growing number of plan sponsors are offering greater financial wellness packages and pay range transparency, coupled with expanded mental health resources, flexible work options, and student loan assistance.
According to the research, 2026 salary increases are expected to range between 3.1% and 3.3%, with 30% of companies planning to offer midyear salary adjustments.
Retirement benefits have also grown as a top workplace benefit, with nearly all employers (98%) offering qualified retirement plans and 16% offering multiple options to save for retirement. Fifty-six percent of plan sponsors say they offer an employer match within 3% to 4.9%, and nearly 30% provide a match of over 5%. About half (47%) of all organizations surveyed offer automatic escalation in their workplace retirement plans.
Employers are extending their retirement benefits past plan coverage to also include access to professional advice. Most plan sponsors (91%) rely on advisors, with 65% of those relationships surpassing five years.
Others are focusing on financial wellness, with 77% already offering or planning to offer a plan catered to financial wellbeing.
The findings come as a greater number of younger workers demand access to financial and retirement benefits to curtail the impacts of higher inflation and day-to-day costs, including rising health care expenses. Ascensus’ research showed that employers saw 4% to 8% increases in health plan costs, while another third also reported seeing inflated prices.
Further, research shows that Millennials and Gen Zers began contributing for retirement at earlier ages and tend to engage with retirement planning compared to more seasoned workers.
“Over nearly two decades of publishing this trends report, we have seen many developments in total rewards, but two recent shifts stand out,” said Ascensus CEO Nick Good in a statement. “First, the post‑pandemic hangover is over. Employers that pulled back on benefits in 2020, and rebuilt them in 2022, are now offering programs at steadier, more sustainable levels. Second, the needs and preferences of Millennials and Gen Z are weighing more heavily on benefits decision-makers. As a result, we are seeing a greater emphasis on retirement readiness, financial wellness, mental health support, flexibility, and help with student debt, alongside careful cost management. The result is a more balanced approach that helps employers stay competitive and meet the long-term needs of today’s workforce.”
Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with nearly a decade of experience and a passion for telling stories and reporting news. She is originally from Queens, New York, but now resides in Denver, Colorado.