Rising benefit costs top concern for 81% of HK employers

As a result, employers are turning to smarter spending.

Rising benefit costs are the top issue (81%) influencing Hong Kong employers’ benefit strategies in 2025, up from 64% in 2023, according to a WTW survey.

As a result, employers are turning to smarter spending, sharper focus, and using employee benefits as a strategic tool to drive engagement, retention, and purpose for their workforce.

The survey also found talent competition (65%) continues to be one of the top concerns, other than the financial pressure on budgets (56%) and expectations for an enhanced employee experience (38%).

“Budget constraints, talent issues, and the uncertainty on the potential impact of tariffs show no signs of easing soon,” Eric Lam, Head of Health & Benefits for Hong Kong and Macau at WTW, said.

As medical care costs continue to show significant growth with a projected increase of 9.8% this year, employers face greater challenges in key areas such as health benefits (63%) and wellbeing programmes (29%).

To address these concerns, employers are shifting their strategy with a few expanding their benefits portfolio, focusing on extracting value from their current offerings, and improving financing, employee experience, analytics, and administration.

In the next three years, 58% of employers plan to reallocate or rebalance spending. To tackle the high costs, a majority (61%) plan to enhance value. Only a quarter (25%) plan to tackle high-cost medical conditions, and 27% plan to adopt preferred medical providers.