A crushing amount of student debt–to the tune of $1.6 trillion nationally, according to the Federal Reserve–is causing employees to clamor for assistance with the load. Employers are starting to listen. Today, about 8% of employers offer a student-loan-repayment benefit, according to statistics from the Society for Human Resource Management–a percentage that has doubled in the past year. Offering a repayment program is an added expense for employers, but advocates say it pays for itself with reduced turnover, increased employee satisfaction and a bigger boost to attraction and retention efforts.
For example, Trilogy Health Services, a senior-care-provider company that contributes $100 a month to employees’ student-loan payments, says employees who use the benefit stay with their company 2.5 times longer than those who aren’t signed up for the program–a significant stat in the healthcare industry, which typically has record-high turnover rates. It’s also a feel-good benefit that shows employees the company cares, says Todd Schmiedeler, the company’s senior vice president of foundation and workforce development.
“We hear such great response from it,” he says. “I had people that hugged me and cried when they were helped to pay off their debt. That makes us feel good about what we do.”
Employers that want to help employees with student-loan debt but don’t want to invest in repayment assistance can support them in other ways, experts say. For instance, allowing employees to trade in paid time off for a payment or incorporating financial education into a wellness program are rising options.