Across the country, businesses in every industry are facing the difficult task of not just hiring but keeping talented employees. Although there isn’t a magical formula to solve recruitment and retention problems, there are effective strategies businesses can employ. Consider these reasons why you should offer a student loan repayment benefit to attract top employees.
Employees leave jobs for many reasons, but often it’s because they receive a better job offer. Given the thousands of job openings, workers have many options. In most industries, job turnover is 12 to 15 percent.
Create an engaged employee experience
Competition for talented workers is fierce. Nationwide, employers spend billions to retain and recruit employees, especially for specialized positions. Tackling this problem requires an innovative strategy to keep employees engaged in their work by improving employee benefits and experiences.
For most employees, work is more than a job. They want to work for employers that show they care, and value their employees by providing appropriate compensation and appealing benefits that meet employees’ needs.
The new benefit employees want: student loan assistance
Traditional medical, dental and vision benefits are expected in employee benefits packages. For many workers, the next important benefit is student loan repayment assistance, along with a college savings plan, such as the BenefitEd program. About 70 percent of college students are graduating with student loan debt, with many owing at least $35,000.
With BenefitEd, employers make payments against an employee’s student debt to help lessen the loan amount. BenefitEd is an easy option to add to employee benefits packages. It’s as simple as determining the employees who are eligible for the benefit and the contribution amount for each worker during a calendar year.
Benefit vs. a bonus
Historically, many employers have offered a bonus paycheck to recognize employee contributions or as a signing bonus for new hires, especially for jobs that are difficult to fill. However, now many employers are offering a student loan assistance benefit, such as BenefitEd.
Ease financial anxiety
Employees are anxious about finances. They spend multiple hours during the workday worrying about how they will meet their financial commitments. Some employees are foregoing major life events, such as buying a car or getting married, to pay off their loans.
Employees report that having a student loan assistance benefit would help ease concerns so that they can focus on their work. An American Student Assistance study showed that 86 percent of employees, aged 22 to 33, would be willing to commit five years of their career to a company that helps them pay down student debt.
Attracting employees, keeping them engaged
In a survey of recent college students working full time, 57 percent indicated that the financial pressure of student loans impacts their work productivity. In this study, about 23 percent said they’d give up some benefits for help with student loans payments. Over 50 percent said they would consider a salary cut if that same amount were applied to their student loan debt.
College savings option
Older employees also are asking for tuition payment programs, such as a 529 plan available through BenefitEd, to help pay tuition and student loan payments for their college-aged children. Due to the rising costs of higher education, many college students reach student loan limits sooner than previous generations. Parents are stepping in to help cover costs, making the college savings plan benefits a popular choice.