A study was implemented by iontuition that focused on the employer’s perspective on student loans in the year 2016. In a nut shell, employers are not ignoring the effects student loans have on their prospective and current employees. The study covered many different companies and asked questions about student loans and their impact on employee relationships; it also asked questions about how employers view student loans.
First off, an overwhelming majority of employers (90%) covered in this study understand that student loan debt is a stress factor for their employees. It is somewhat relieving to know that the issue is not lost on the hiring companies. Furthermore, 80% of these employers believe that this stress factor reduces work potential and productivity. Not only do they understand the issue, but they also think that this carries over into the workplace.
It is no mystery that student loans cause problems for new young employees; for instance, new graduates often put off important financial tasks in light of their student loan debt. Employers are no exception because 75% seem to think that employees neglect their 401(k) due to student loan debt pressure. This ties into the recent mention of financial stress factors that affect work productivity. Now it can be implied that student loans hurt both employer and employee.
There has been a new trend with companies offering employee benefits that target student loans. The data that was just provided may lead one to believe that this benefit is widespread. That is not the case. 8% of employers in the year of 2016 offer student loan assistance benefits. The benefits is clearly not widespread despite 70% of respondents to the survey claiming that it would improve morale and productivity.
It is no secret that student loans are affecting the up and coming workers in the labor market. This issue is now receiving more and more attention from employing companies; for instance, while companies offering student loan benefits are small in number, they are up 5% from the previous year. It is reassuring hearing this, but the solution to student loans may not be employers’ responsibility. More needs to be done when it comes to student loans.