What Is the Size of the Employee Benefits Industry?

How large is the employee benefits industry? According to a 2024 survey by KFF, 94% of employers with 50 or more employees offered health benefits in 2024. In the same survey, 89% of employers with 3 or more employees offered health benefits to at least some of its team. Some employees choose to self-insure or aren’t eligible to enroll, and others are enrolled on a plan with their spouse; only 61% of workers at firms offering benefits are actually enrolled.

Overall, though, when cross referenced to the number of employed Americans in small, large, and medium sized firms, there’s enough data to provide a fairly robust estimate! Out of the 340.1 million  Americans, estimates from the Bureau of Labour Statistics suggest that 60.2% of them were employed, making the number of employed Americans 168 million in 2024. U.S Census data on firm size is only available from the 2021 Annual Data Tables, but the split between different sized firms can provide an estimate for workforce distribution in 2024.

The final estimate suggests 148 million workers are either actively have or are eligible for employer sponsored health care.

So what is the employee benefits industry worth? 

According to KFF, the average annual premium for employer-sponsored health coverage in 2024 was 8,951 for single coverage and $25,572 for family coverage​. Taking the average, $17,261, and multiplying it by 148 million eligible workers, the result is a rough estimate of the employer benefits industry value – $2.55 trillion. 

So what is the employee benefits industry actually worth?

That figure—$2.55 trillion—represents only the health insurance portion of coverage, and only in the United States. Adding in other regions, and other benefits, such as dental, vision, disability, retirement, or paid leave, the true size of the employee benefits industry becomes even more substantial. Depending on what’s included, it’s fair to say the US  industry likely exceeds $3 trillion annually in US dollars – which actually gets you pretty close to the 3.8 trillion estimate provided by the Employer Benefits Research Institute. 

Globally, the market for healthcare benefits exists in virtually every developed nation worldwide. 

The employee benefits industry is a critical part of daily life. As employers seek to attract and retain talent, they are increasingly demanding alternative health benefit plans – such as self funded, high deductible, or association health plans  which can be stacked and combined to better meet policyholder needs. Employers seeking to retain and attract top talent in a post-pandemic labor market must understand that the right benefits package or health benefits strategy is no longer optional – it’s a critical part of your organization’s strategic goals.