What are the 3 top barriers to understanding benefits costs?

Global employers are tightening benefits governance and turning to artificial intelligence (AI) as costs climb and administration strains HR teams, according to MBWL International’s 2026 Global Benefits Forecast.

Currently, three in five organisations believe they manage and govern benefits effectively.

Over six in 10 (61 per cent) agree or strongly agree their organisation “is effective in its management and governance of global benefits.” Yet 23 per cent neither agree nor disagree and 15 per cent disagree or strongly disagree, which the report says “highlight areas of uncertainty and outright concern” about how governance works on the ground.

For HR leaders, that gap between confidence and doubt points to uneven practice and communication across markets.

Cost control with benefits7

Cost control will dominate global benefits agendas this year, according to the MBWL International survey of 372 organisations, including 231 multinationals.

Almost two‑thirds (64 per cent) of respondents say cost control will be their primary focus in 2026, far ahead of plan design, benchmarking and strategy at 48 per cent. Environmental sustainability (5 per cent) and diversity, equity and inclusion (10 per cent) barely register as top‑tier benefits priorities, underscoring how inflation and fiscal pressure have pushed longer‑term themes down the list.

At the same time, employers are reshaping benefits to compete for talent: 45 per cent intend to introduce or improve physical and mental wellbeing supports over the next two years, 41 per cent will focus on better communication or positioning of benefits, and 36 per cent plan to enhance healthcare or medical coverage.

Barriers to seeing full cost

Despite the intense focus on spend, many organisations still lack a clear view of their global benefits bill. For the third consecutive year, three obstacles dominate:

• a wide variety of benefit plans across countries (55 per cent)
• lack of data or information (47 per cent)
• multiple providers or sources (46 per cent).

The report says this “wide variety" reflects “the inherent complexity of operating in diverse regulatory, cultural, and market environments,” producing fragmented offerings and making “like‑for‑like cost comparisons challenging and often results in inconsistent data aggregation.” A further 37 per cent cite a lack of a consistent approach to measuring costs, while only 21 per cent blame insufficient technology.

When asked about their main challenges in global benefits management, 46 per cent of respondents point first to controlling costs. Another 31 per cent say they lack a single view of plans, policies and vendors, and 28 per cent report spending too much time on administrative tasks.

When it comes to workplace benefits, there is a disconnect between what employers believe and what workers think, according to a previous recent report.

Managing rising costs of benefits

At the administration level, limited internal resources are the biggest problem, cited by 56 per cent of organisations, followed by high volumes of manual processes (32 per cent), lack of consistency across geographies (31 per cent) and benefit plan complexity (31 per cent). The report concludes that “administration remains labour‑intensive and resource‑constrained, driven primarily by capacity limitations, manual work, and the inherent complexity of global benefits delivery.”

To manage or reduce rising employee benefits costs, respondents favour structural improvements over blunt cuts. Forty per cent plan to improve governance of benefits, 36 per cent aim to automate administrative processes and 28 per cent intend to improve visibility of plan costs. A quarter or more are looking to introduce or enhance wellbeing and preventive care programmes, and to “communicate smart usage of plans (aimed at employees).” Only 7 per cent list reducing benefits as a priority.

MBWL says organisations see “strengthened oversight, policy alignment, and centralised decision‑making as foundational to controlling spend,” while automation should “streamline claims, enrolment, and vendor interactions to reduce overhead and errors.” For HR, the findings highlight a mandate to lead cross‑border governance frameworks and process redesign in tandem with finance and procurement.

Uneven adoption of AI

AI is emerging as a key lever in this shift, though adoption remains uneven. Currently:

• 38 per cent of respondents use AI to personalise employee communications
• 27 per cent use it to collect and analyse plan documents and information
• 26 per cent deploy it to enhance employee engagement and satisfaction.

Overall, the authors say “AI adoption is accelerating across HR and benefits functions,” used “to personalise communications, improve data analysis, and increase engagement.”

The report notes that “all other uses we included in last year’s survey and again, this year have significantly increased (at least threefold across the board).”

Employers’ expectations of AI are mainly operational. Sixty‑six per cent want it to reduce administrative workload for HR and 50 per cent to improve the efficiency and productivity of the benefits team. Thirty‑four per cent seek increased employee understanding of their benefits, and the same share target cost savings.

But two‑thirds (67 per cent) see data privacy and security as the main challenges in adopting AI for benefits, while 40 per cent cite integration issues with existing HRIS or payroll systems, 33 per cent worry about cost and 29 per cent about accuracy of outputs. The report describes data privacy and security as “the most significant anticipated challenge,” reflecting “heightened awareness of the sensitive nature of employee data related to benefits.”

MBWL recommends employers “pilot AI in clearly defined use cases, such as personalised communications,” “address data security and privacy early, using trusted, certified providers,” and “choose scalable solutions that integrate with existing systems.” It also urges organisations to maintain “accurate, up‑to‑date global benefits data across all plans” and to use governance, automation and analytics to “optimise design and manage spend” as benefits costs continue to climb.

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