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External HR Support Can Help Small and Midsize Businesses Manage Rising Benefits Costs and Compliance Complexity

Healthcare costs are surging, and compliance landscapes are growing more complex across state lines. HR professionals are forced to rethink how they support both their people and their business strategy. Rising benefits costs, multi-state compliance, and talent retention pressures have converged to make HR one of the most critical and complex functions for small…

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By Daniel Litwin · Hr Southwest Conference 2025
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Key takeaways

01

Healthcare costs are surging, and compliance landscapes are growing more complex across state lines.

02

HR professionals are forced to rethink how they support both their people and their business strategy.

03

Rising benefits costs, multi-state compliance, and talent retention pressures have converged to make HR one of the most critical and complex functions for small…

Healthcare costs are surging, and compliance landscapes are growing more complex across state lines. HR professionals are forced to rethink how they support both their people and their business strategy. Rising benefits costs, multi-state compliance, and talent retention pressures have converged to make HR one of the most critical and complex functions for small and mid-sized companies in 2025.

How can small and midsize companies remain compliant, cost-effective, and people-focused amid rising benefits costs and a rapidly shifting regulatory environment?

At this year’s HR Southwest Conference(HRSWC), MarketScale’s Daniel Litwin, the voice of B2B, sat down with Jake Reedy, a Sales Consultant at TriNet, a Professional Employer Organization (PEO) that supports small and mid-sized businesses in managing HR complexity at scale. Reedy shared how data-driven technology and strategic partnerships are redefining how growing companies approach compliance, benefits, and workforce management.

Key Takeaways 

  • Healthcare Costs Are Soaring Again — After years of stability during the pandemic, health insurance renewals have spiked as small businesses grapple with sharply rising premiums. The so-called “pickleball effect,” as Reedy describes, has driven up post-pandemic healthcare utilization and costs.
  • Small Businesses Need Creative Benefits Strategies — With rising costs squeezing margins, small and mid-sized firms must get creative in their benefits offerings. Partnering with a PEO like TriNet allows access to pooled buying power and benchmarked rates that can significantly reduce overhead.
  • HR’s Role Is Shifting Toward Mediation and Expertise — While finance teams feel the brunt of benefits inflation, HR departments are expected to be the “experts” answering employee questions and navigating complex plan structures. PEOs relieve this burden by offering certified HR and benefits professionals who handle that expertise in-house.
  • Compliance Complexity Is at an All-Time High — For growing companies expanding across multiple states, compliance is becoming unmanageable internally. Reedy emphasizes that it’s “not your job to refresh Texas or California state laws daily.” Instead, outsourcing this to a PEO ensures coverage across ever-changing local and federal regulations.
  • Data and Scale Create Smarter HR Decisions — With a client base of over 360,000 employees, TriNet leverages data from similar organizations to provide predictive reporting, benchmarking, and insights. Their platform “learns” from usage, helping HR leaders make data-driven decisions faster and with more accuracy.

Jake Reedy is a sales consultant at TriNet, a Professional Employer Organization (PEO) that supports small and mid-sized businesses with workforce, benefits, and compliance management. He specializes in full-cycle business development, combining strategic outreach, relationship building, and consultative selling to help organizations streamline their HR operations. Reedy established a record of exceeding performance goals and mentoring peers in effective prospecting and client engagement strategies.

Article written by Sonia Gossai

Video TranscriptExpand ↓

What's going on y'all? It's Daniel Littwin, the voice of b two b. We're here with another interview at the MarketScale Media booth at HR Southwest twenty twenty five. We're sitting down with Jake from TriNet. Welcome, man. It's great to have you here in the booth, and I'm looking forward to talking shop on how you and your team play a role in supporting the major trends in HR today. How's the show been for you so far? Absolutely. Well, first off, it's a pleasure to be here. Yeah. And it's been good. It's actually my first time ever doing a trade show like this. So it's been awesome. I've gotten to meet a lot of cool people, see a lot of cool things, learn a lot, I'm just excited to be here. So let's talk shop a little bit. Tell our audience more about the role that TriNet plays in the HR ecosystem. How do you support HR and what are y'all's core competencies? Yeah, that's a great question. So we're a PEO, professional employer organization. We support small to medium size. So think as small as three, I would say as big as about five hundred six hundred. After that, you're probably gonna hire a full HR team and you're gonna keep everything in house. What are the big challenges that are shaping the HR world in twenty twenty five? Like what does almost every HR professional feel some pressure around today? Rising cost of employee benefits. Okay. So back in twenty nineteen, twenty twenty, when COVID and the world shut down, healthcare was pretty stagnant and pretty flat for renewals. And that's because nobody was doing anything. One of the big carrier CEOs, they call it the pickleball effect. After COVID, everybody started getting out, getting out of the house, going and play pickleball. But with that, people went out and they got hurt and they started going to the doctor again. So usage picked up. When usage picks up, the rates go higher. So we've seen crazy. I mean, I've seen as high as, I think, forty three percent increase is the highest I've seen. So for a small to medium sized business, that's not sustainable. Right. So I think what they have to do is they have to get creative as far as offering benefits for their employees. And one way to do so is to reach out to a PEO like TriNet Yeah. And just benchmark and get what rates would look like versus if what they're doing today more than likely on the open market. How are you seeing that pressure from rising costs of benefits impact the actual people, the folks that you work with day in and day out? Yeah. Great question. So I think a lot of it is when it comes to cost, that's more so gonna be on the owner or the finance team. Sure. Where that doesn't necessarily impact HR quite as much, so the cost is going be on the small business owner, him or herself, and then the finance team, I'd say where HR is really seeing it is they have to play, as you mentioned, the mediator. But on top of that, when it comes, if we're just talking about benefits is they're looked at as the expert. Right. If they have a benefits question, for whatever reason, the HR person's supposed to be the benefits expert. So we like to take a lot of that, not only burden, but administrative work off of their plate and onto a company like TriNet where we have certified benefits professionals, SHRM certified HR to answer those questions for them. Okay, so now beyond benefits, Where are HR teams needing the support of a PEO the most Today. That's a great question. I think a lot of it and why our target market is small to medium sized oftentimes growing companies My my dad, for example, he's a small business owner. He does the HR side of things. One state, sixteen employees. Yeah. There's not a whole lot of compliance or stuff that you have to deal with thankfully. Now you're an HR person and And you've got six states and you just got funding from a VC or private equity firm and you're growing to sixteen states. It's like Where do I even start? Where do I even start? So with that too and with the new administration, all the ever changing laws in all of the different states and counties, that is where I think you should really lean on a PEO to take that. It's not your job to sit and refresh the Texas state laws every day or California or New York. So I think that is a an especially a big burden that a PEO can take off of a an HR admin's plate. How critical would you say the data layer is to be able to operate more effectively, and how does a PEO Help either capture more data usually or just make better sense of all the moving data pieces and data points that an HR pro might have to deal with. Our client base is, I think, three hundred and sixty thousand ish as of our most recent quarterly report. So that's a lot of people. Yeah. So the odds of your company being very, very similar to a company that we already have is very high. Right. So with that, our technology platform, it gets smarter and it learns. I think a big aspect of our platform is the reporting. You can get really granular with reporting and it learns from very similar clients. So the odds of us having a report already built out is very, very high. Yeah. So folks want to learn a little bit more about TriNet, about the services y'all provide or they want to get in touch with you, how can they do so? Yeah, just go to LinkedIn, Jacob Reedy, TriNet or if you just want a high level again just go to w w w dot trinet dot com. I would highly recommend if you're in the HR world to give a PEO a look.

About the author

Daniel Litwin
Daniel LitwinEditor, B2B Media, MarketScale

Daniel Litwin is a journalist of multiple disciplines focused on finding and telling engaging stories for B2B communities. He has interviewed executives from Fortune 500 companies including Honeywell, Microsoft, John Deere, and Chipotle, and leads editorial direction at MarketScale. Litwin hosts weekly shows and podcasts while helping develop new content approaches across the MarketScale platform. He holds a B.J. in Radio/Television Reporting/Anchoring and a B.A. in Spanish from the University of Missouri-Columbia.

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Daniel Litwin