Offering Student Loan Assistance Can Help Recruit and Retain Millennial Employees
The United States is battling a student loan problem of epic proportions. Today, over 44 million Americans collectively hold more than $1.4 trillion in student loan debt. The problem is only getting worse – we're adding $2,726 per second as an upwards of 70 percent of graduates enter the workforce with college loans.
Student debt can affect the quality of life and work productivity for an entire generation of workers, but this crisis also presents employers with a significant opportunity to engage talent.
Student loan assistance from leading providers such as Peanut Butter enables employers to make monthly contributions toward their employees’ student loan obligations, while adding almost no additional administrative burdens for human resources teams. Student loan assistance offers many critical talent advantages:
Millennials will stay at a job at least 36 percent longer when student loan assistance is offered by their employer, according to a 2016 Millennial Benefits Preferences study conducted by FC Consulting. Why? Employees appreciate working for an employer that shows empathy and possible solutions for financial challenges, including student debt struggles. The study also found that employees are more likely to stick with their employers as they see the monthly contributions shorten the payoff date of their loan.
Student loan repayment assistance has proven to be a particularly powerful benefit for college-educated millennials. In fact, the Millennial Benefits Preferences study found that 85 percent of 21-34-year-olds would accept a job offer that included student loan repayment. This affords organizations a powerful advantage for recruiting college-educated talent over their competitors. Female, African American, and Hispanic recruits may hold disproportionately higher amounts of student debt, making this benefit a powerful tool to grow diversity as well.
Recruiting advantages may also save costs and time. If your company's offer rate is 65 percent (higher than the National Association of Colleges and Employers average), you could possibly sign the same number of candidates with fewer offers, interviews, resume reviews, and recruiting efforts.
A Mutually Beneficial Opportunity
Student loan assistance can be a win-win opportunity. Employees can save thousands in principal and interest from fast-tracked loan repayment. They can also feel comfort in knowing that their employer cares enough to offer a benefit that is relevant to them.
Companies may enjoy greater recruitment numbers, and possibly greater productivity through longer employee tenure. Peanut Butter clients usually save more than $5 in turnover and recruitment costs for every $1 invested in a student loan assistance program. In addition, employers offering student loan assistance can take pride in being part of the solution to America’s student debt crisis.
Peanut Butter can provide student loan assistance benefits to Paychex clients. Learn more about this partnership here.