Student debt…. where to begin. It is an epidemic in the current age as many college students are graduating with thousands of dollars in debt. Pair that with a very competitive job market and you’re in a hole that is tough to get out of. That, paired with a very competitive job market can create a situation where new college graduates are digging themselves out of a financial hole. According to Lending Tree, “Americans owe over $1.56 trillion in student loan debt, spread out among about 45 million borrowers. That’s about $521 billion more than the total U.S. credit card debt.”
Competition for a strong workforce is fierce, so what is an easy way for companies to attract top talent? Adopt benefit options that help their employees with student loan debt. Tuition assistance has been offered for quite some time but assisting in paying off debt is rather new. So how can companies start implementing this? According to shrm.org, there are a few different options they may have.
- Tax-free education assistance
- PTO trades which allow workers to use PTO to pay off student loans.
- Monthly contributions
- Paid tuition to selected universities that give students the skills that meet the company’s needs.
- Contributions to a worker’s 401(k) if the worker puts a certain percentage of his or her pay toward student loan repayment.
All of this sounds great, but are there any drawbacks? The PTO option may lead to an employee using all their PTO towards their debt that they become burnt out and unproductive. This may also raise concern for older employees who may have accumulated student loan debt from either themselves, their children or grandchildren.
The rise in college tuition and the ever-increasing amount of debt students are taking on, helps to carve out a market for employers looking to entice top candidates. While this is a newer idea, and some companies have already implemented such ways, it will be a while before the student debt crisis is put in check.
Do you need help creating a competitive total compensation package that includes student loan repayment assistance? Contact Axiom HRS today at hr@axiomhrs.com.