Marketplace · Friday, July 31, 2026
The cost of employee benefits rose 3.8% annually in the spring, exceeding wage growth of 3.2%, according to the Bureau of Labor Statistics. This increase is largely attributed to rising healthcare insurance costs for employers, influenced by medical innovation and a shortage of healthcare workers.
“The employment cost index from the Bureau of Labor Statistics. In other words, what it costs employers to pay their workers. And it shows that this spring, the cost of employee benefits was up 3.8% from a year earlier. That's a faster rate of growth than wages, which were up only 3.2%.”
“Health insurance costs for employers have been growing at a rate we haven't really seen since 2005. So then that makes you of course wonder, well, why is this going on?”
“One is there's been a lot of innovation in healthcare. We have new drugs. New drugs tend to be more expensive than old drugs. Groshian says these drugs could make workers healthier in the long term. But right now, they're driving insurance costs up.”