6 benefits market shifts facing HR leaders

As 2026 reaches its midpoint, HR leaders are seeing many of the year’s biggest workforce challenges move from emerging trends to immediate business priorities. Healthcare costs remain elevated, employees continue to expect more personalized support, AI adoption is accelerating, and regulatory changes are requiring closer attention across total rewards.

CBIZ’s 2026 Market Outlook Guide highlights that these forces continue to converge across benefits, compensation, risk and talent.

See also: U.S. healthcare affordability falls to lowest level since 2021

Employers are experiencing some of the highest healthcare cost increases in recent years, driven by continued growth in GLP-1 utilization, the emergence of high-cost gene therapies, rising chronic disease rates, increasing cancer treatment costs and sustained demand for mental health services.

Claims data continues to show that a small percentage of members account for a significant share of healthcare spending, making targeted strategies more effective than blanket cuts.

What HR needs to do:

• Invest in data analytics to understand the cost drivers in your health plan, ensuring your strategy, benefit design and vendor partnerships align with your primary cost drivers.
• Continue to evaluate and consider alternative funding models for pharmacy and medical programs and targeted point solutions that address specific cost drivers.

Employees still expect personalized, flexible benefits

Roughly 70% of employees say customizable benefits increase loyalty. Demand spans financial wellness programs, retirement flexibility (including Roth options and catch-up considerations) and family-forming support such as fertility services, adoption assistance and parental leave. Personalization is particularly powerful in multigenerational workforces, where needs differ by life stage.

What HR needs to do:

• Consider a core-and-voluntary benefits structure that allows employees to tailor coverage to their individual needs.
• Leverage digital tools and analytics to deliver more personalized benefits education and recommendations.
• Use personalization as a differentiator in the broader employee value proposition.

Operational resilience and workforce protection are ongoing priorities

Continued economic uncertainty, cyber threats, severe weather events and evolving operational risks require HR leaders to take a more proactive, cross-functional approach to protecting their workforce and maintaining business continuity. With responsibility for payroll, benefits, employee communications and compliance, HR leaders set direction and coordinate cross-functional execution.

What HR needs to do:

• Run a holistic risk assessment, evaluating climate, cyber, regulatory, workforce continuity and supply chain exposures.
• Implement scenario planning for natural disasters and cyber incidents.
• Modernize disaster recovery and data protection protocols by updating playbooks and creating crisis communications and employee safety procedures.
• Strengthen vendor oversight with required defined risk standards, regularly review third-party exposures and coordinate with procurement.
• Work with risk and finance teams to evaluate alternative financing options, such as captives, group programs and specialty coverage to stabilize costs.

AI adoption continues to transform HR

In the first half of 2026, organizations have continued to expand their use of AI across recruiting, onboarding, payroll, benefits administration, workforce planning and employee support. However, increased adoption has also heightened concerns around data security, bias, transparency and oversight. The most effective organizations are balancing innovation with strong governance.

What HR needs to do:

• Establish an AI governance framework that complies with evolving laws and standardizes acceptable use.
• Invest in a comprehensive human resources information system (HRIS) to centralize data and support AI-driven insights with auditable workflows.
• Pair AI adoption with cyber risk management by assessing vulnerabilities in HR automations, coordinating with IT and security, and reviewing cyber insurance coverage to ensure HR systems and AI tools are within scope.
• Recruit with an AI-enabled workforce in mind, evaluating AI literacy in potential new hires.
• Train existing employees on AI capabilities to enhance literacy and arm HR teams and managers with tools to enhance oversight.

As AI and automation continue to transform HR, leaders must move from simply collecting data to acting on it. Connect analytics and HR systems, equip managers to communicate clearly and prioritize responsible AI governance to help reduce compliance risk.

Skills gaps and talent retention remain long-term challenges

Although labor market conditions continue to shift, many employers are still struggling to secure specialized talent and prepare their workforce for changing business needs. As a result, skills-based hiring, internal mobility and workforce development remain key priorities.

What HR needs to do:

• Map current skills needs to guide training and reskilling priorities.
• Define clear career pathways and internal mobility programs to help support retention.
• Invest in skills-based compensation and development incentives to encourage workforce growth.
• Formalize career pathways with mentorship, tuition assistance and transparent advancement criteria.
• Link pay, incentives and recognition to certifications and acquired skills, not tenure.

HR leaders should conduct a quarterly build-versus-buy review of the top 10 roles by business impact. For each role, define the target skills and time-to-proficiency. Decide whether to meet the need by hiring, reskilling or using contingent talent.

Regulatory changes continue to shape total rewards

The regulatory environment remains active in 2026. Ongoing implementation of SECURE 2.0 requirements, expanding pay transparency laws, heightened fiduciary scrutiny and new considerations resulting from the One Big Beautiful Bill Act (OBBBA) are requiring employers to maintain strong coordination across HR, legal, finance and benefits teams.

What HR needs to do:

• Update retirement plans and enhance compliance documentation.
• Standardize pay ranges and manager training to help ensure adherence to pay transparency laws.
• Conduct frequent audits and coordinate with legal and finance.

Navigate the remainder of 2026 with confidence

As the second half of 2026 unfolds, these six market shifts will continue to influence employer costs, workforce expectations, technology strategies and compliance obligations.

HR leaders must remain agile, balancing immediate challenges with long-term workforce investments that support sustainable growth.