Guess what? The industry’s top talent, those who just graduated at the top of their class, are struggling with crippling student loan debt. Choosing an employer is more than just about salary and health benefits. Google offers onsite doctors, free cafeterias and even haircuts at their offices.
What does your company offer?
Not everyone can be Google, but there is one way to attract the best talent in the industry: student loan help. CNBC reports that 8 out of 10 workers would “value” working for a company that helps them pay off their student loans.
The student loan debt crisis is up to $1.4 trillion, and less than 5% of companies are offering repayment assistance. If your company wants to attract top talent, it’s time to start helping employees pay down their monstrous student debt burden, which averages just over $37,000 per person.
Offering top dollar for a position is great, but there are other ways you can help, too.
1. Monthly Contributions are a Start
Memphis, Tennessee decided that the city wanted to help their employees overcome their student loan debt. The city doesn’t have the money for a large expenditure every month, so they’re offering $50 a month towards their employees’ student loan repayment.
The idea has helped the city retain employees. Memphis acknowledges the student loan crisis, and their contribution, $600 a year, will help their employees pay off their loans faster.
2. Contributions Through Fidelity Investments
Fidelity Investments announced a plan to help employers assist their employees with paying off student loan debt. The program will allow for regular payments towards an employee’s debt. The company also offers a free tool to help employers better understand the debt of an employee.
The company itself has helped employees pay off their debt, with up to $2,000 per year in benefits and up to $10,000 in repayment in total.
You can choose to use a third-party company to help tackle your employees’ student loans, or you can tackle the issue internally if you wish.
Tax Legislation Needs to Catch Up
Tax legislation is a big sticking point for most companies that haven’t started to offer student loan assistance. The government hasn’t enacted legislation to promote student loan repayment benefits.
Employers pay, effectively, $107.65 instead of $100 when they help pay off their employees’ debts.
The benefits are viewed as compensation and is taxed as payroll tax as a result. But companies that can offer even a small contribution to an employees’ debt repayment will be able to attract higher tier talent.