February 10, 2026
Business owners across the Southeast are navigating a mix of wage rate stability and rising health insurance costs that are affecting payroll planning and benefits budgets. While most states in the region continue to follow federal wage standards, premium increases and contribution structures are creating pressure points that require leadership attention.
Minimum Wage Landscape Remains Stable in Most States
The majority of Southeastern states continue to operate under the federal minimum wage of $7.25 per hour, including Florida, Georgia, Alabama, South Carolina, Tennessee, Kentucky, Texas, Indiana, Ohio, and Arkansas. This has remained unchanged for over a decade at the federal level, meaning baseline wage obligations have not shifted for most employers in the region.
Virginia stands apart with a current minimum wage of $12.41 per hour and a legislated path to $15 per hour. Employers operating in Virginia or expanding into that state should confirm that wage structures account for this difference, especially for roles near the exemption threshold.
North Carolina follows the federal standard but has seen increased enforcement activity around misclassification and overtime exemptions. While the wage floor has not changed, the compliance focus has shifted toward how employees are classified and paid in practice.
Health Insurance Premium Increases Continue Across the Region
Health insurance remains one of the fastest growing cost drivers for employers. Across the Southeast, employer sponsored health plan premiums are rising at an average of 7 to 8 percent annually, consistent with national trends. This increase affects both fully insured and self funded plans, though the impact varies based on plan design, carrier, and employee demographics.
States with larger metropolitan areas, including Texas, Florida, Georgia, and North Carolina, are seeing slightly higher premium growth in urban markets compared to rural areas. Employers in these states should review contribution strategies and evaluate whether current cost sharing models remain sustainable as premiums continue to climb.
Key factors driving premium increases in the region include:
What This Means for Multi State Employers
For businesses operating across multiple Southeastern states, the challenge is less about wage rate differences and more about managing benefit cost consistency. When health insurance premiums increase at different rates depending on location and carrier, employers face difficult decisions about whether to absorb costs, shift them to employees, or adjust plan designs.
Employers should also be aware that mental health parity enforcement continues to increase. Regulators are scrutinizing how behavioral health benefits are administered compared to medical benefits, and documentation requirements are becoming more detailed. This adds compliance complexity on top of rising premium costs.
Planning for Mid Year and Open Enrollment
Most employers finalize open enrollment planning in the third and fourth quarters, but mid year is the right time to review current cost trends and evaluate options. Employers should be asking:
For employers who have not reviewed their benefit strategies in the past 18 months, now is a good time to evaluate whether current plan offerings still align with business goals and budget realities.
Action item for this week: Review your current health insurance contribution structure and confirm whether premium increases over the past year have been absorbed by the company, passed to employees, or shared proportionally.
