Nearly 70% of seniors who graduated from college in 2015 had student loans averaging out to $30,100 per borrower. So reports the Institute for College Access & Success. That was 4% higher than the average debt for graduates in 2014. And last year, 40 million college graduates had a total of $1.3 trillion in student loan debt, averaging out to $35,000, Forbes notes.
A number of companies in 2016 implemented benefit programs to help their employees knock down their student loan balances and that trend is expected to grow this year. Penguin Random House adopted the benefit in November when it started contributing $1,200 a year per employee to help pay down their student debt, Time reports.
Penguin employees have to wait one year before receiving the $1,200--a benefit open to all workers--and can collect a maximum of $9,000. CEO Markus Dohle touts the benefit as a tangible way for the company to do its part to tackle a large societal problem.
Only about 4% of employers, however, offered such a benefit last year, the Society for Human Resource Management notes. But, a Fidelity survey on employer-sponsored health and wellness programs cited that 13% of 129 firms it polled offered student loan repayment help in 2016, according to the Time article. Additionally, 21% surveyed said they would consider offering the benefit this year.
Student loan debt is top of mind for young job candidates with more than 75% saying they would give serious consideration to accepting a job offer if they could get help with their debt, Time reports citing a 2015 survey from American Student Assistance. And 49% of young workers placed a higher premium on student loan assistance over other company benefits, including retirement plans, Time notes citing a survey from EdAssist.
“Coming out of college, their paychecks aren’t huge and they need as much help as they can get,” Jen Cantu, vice president of people at Trendkite, a public relations analytics firm, tells Time.
Chegg, a textbook rental and online tutoring firm, also offers its employees help with student loan debt and is considered an early adopter of the benefit. Other companies offering the benefit include PricewaterhouseCoopers, CommonBond and LendEDU, Natixis Global Asset Management and Moonlight Bunny Ranch, a legal brothel in Nevada.
The U.S. Office of Personnel Management (OPM) also gives a thumbs up to student loan repayment benefits, FEDweek reports. OPM issued a report citing several federal agencies that have endorsed student loan reimbursement as a way to “attract and retain highly-qualified employees who might otherwise leave for higher salaries in comparable jobs or move to areas with a lower cost of living.”
OPM suggests that agencies track retention rates of employees who receive the benefit against those who don’t take advantage of them. “Also, agencies can use survey data to measure the satisfaction of both job candidates and hiring managers with the availability of human resources flexibilities such as student loan repayment benefits,” OPM notes.