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Hong Kong Employee Benefits Report 2025: Key trends for employers
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Hong Kong’s employee benefits (EB) landscape is facing significant risks and challenges driven by rising medical inflation, intense competition for talent, and mounting workforce stress.
While these challenges are placing growing pressure on employers, they also present an opportunity for businesses to rethink benefits design, elevate employee value propositions and build long-term workforce resilience.
Howden’s latest Hong Kong Employee Benefits Benchmarking Report 2025 draws on data from nearly 300 companies covering 42,000 insured members.
This comprehensive report uncovers the critical trends shaping the employee benefits strategy and practices in today’s talent-driven market and equips employers and human resources professionals with actionable insights to navigate emerging trends and future-proof their workforce.
Report highlights include insights on these key trends:
Check out our latest Benchmarking report
Medical inflation intensifies cost pressures
Medical inflation has surged notably in 2025, with projected averages crossing the 10% mark, the first double-digit rise in three years. This is placing growing strain on the healthcare system and employer-sponsored benefit budgets.
With government projections showing 36% of Hong Kong’s population aged 65 or older by 2046¹, healthcare costs are set to rise further.
This inflationary environment is already visible in claims ratios, which climbed back to 95% in 2024 after dipping the previous year. High utilisation, particularly among older employees, creates the risk of sharper premium adjustments at renewal if not managed strategically.
Employers can no longer afford reactive cost-cutting. Instead, they need proactive plan performance reviews, claims data analysis by grade and diagnosis, and targeted interventions.
Medical inflation has hit double digits, and it’s not slowing down. Employers need to anticipate cost trends early – and use claims data and demographics to make smarter renewal decisions.
Competing for talent through benefit value
In today’s tight labour market, benefits are not just a cost line, they are central to talent attraction and retention. Four in five Hong Kong employees2 now consider health support a key factor in career decisions. Employers that fail to offer compelling, personalised packages risk falling behind in the battle for skills.
Dental benefits are increasingly valued as a differentiator for mid-career professionals and executives, though fewer than six in ten companies currently provide them. Meanwhile, 70% of employers extend dependent cover to senior management, but only 39% to general staff. Broadening access can help organisations stand out, even within budget constraints.
As costs rise, strategic premium negotiation is also becoming more important. Data-backed discussions with insurers led by Howden, have helped some employers cut proposed premium increases by an average of 11%.
Rising workforce stress reshapes benefit priorities
Hong Kong’s fast-paced working culture and economic uncertainty are fuelling growing stress across the workforce.
Hybrid work, financial pressures, and social factors are amplifying the strain, particularly among younger employees. Yet most employers still focus narrowly on inpatient, outpatient and dental, with limited provision for mental health, financial wellness, or flexible working.
Mental health cover remains especially underdeveloped. Only 30% of employers include outpatient benefits, and just 24% extend cover for inpatient treatment. With Gen Z employees increasingly prioritising employers who support mental health3, this gap risks undermining recruitment and retention.
Beyond mental health, preventive care remains modest. Flexible working is another area where Hong Kong lags: only 10% of the private-sector workforce benefits from formal arrangements4, despite nearly 80% of Gen Z preferring hybrid work5.
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Our Hong Kong Employee Benefits Benchmarking Report 2025 provides deeper insights, detailed benchmarking data, and practical guidance to help organisations navigate these shifts. Learn more about the key trends and how to integrate these insights into your employee benefits strategy to attract, retain and empower your workforce.
¹ “Hong Kong need not nudge its elderly across the border,” SCMP
2 “4 out of 5 HK employees weigh health support in job decisions,” Hong Kong Business
3 “2025 Workplace Mental Health Trends, Implications, and Actionable Strategies in Hong Kong,” Expivotal
4 “Only 1 in 10 Hong Kong non-government workers enjoys flexible schedules: survey,” SCMP
5 “Nearly 8 in 10 Gen Z workers in HK prefer hybrid working,” Hong Kong Business