In the last year, more and more companies have started offering their employees cash to pay off student loans as part of benefits packages. And those that need it most – college students with tonnes of debt and little-to-no income – want to work at those places.
Over 60 per cent of 2,500 new graduates surveyed by Indeed, a job search site, said they are looking to work somewhere that will put some money toward their student debts. The survey, released Thursday (19 May), also found that a quarter of respondents say it's a “top priority” to land a job that will help pay back some of their loans. Another survey from a few months ago found that a third of Millennials expect their employer to pay back some of their loans.
“As student loans loom large on the conscience of seniors, it’s top of mind,” said Paul D'Arcy, senior vice president at Indeed. “They have big loans and when getting a job, it’s a natural link.”
Unfortunately, most graduates won't end up working somewhere that offers this dream benefit – it’s still super niche: Despite a string of high profile organisations offering the benefit, only about 3 per cent of employers offered loan assistance in 2015, according to a survey by the Society for Human Resource Management (SHRM). Indeed says that less than one per cent of its listings mention the benefit in job postings.
"For companies there's an opportunity here in the war for talent," added D'Arcy.
The good news for grads is that the places that tend to offer the benefit hire lots of people right out of college. Companies like Fidelity and
PricewaterhouseCoopers, which has said it plans on hiring 11,000 people through on-campus recruiting this year, were among the first to make big, splashy announcements about offering the benefit. And, graduates desperate to pay off their debts are starting to notice. “Now that there’s some visibility in media, they know to ask about it,” said Bruce Elliott, the manager of compensation and benefits at SHRM.
The benefit, while only a few hundred dollars a month, can take a big bite out of someone's debt burden. One study estimated that just US$167 (S$229) a month can save an undergraduate with around the average debt burden US$4,100 (S$5,600) in interest.
As the hiring market gets tighter, more companies fighting for young, highly educated talent will start offering the benefit, predicted Elliott. “Employers that heavily recruit on college campuses, I think they're going to be quick to adopt this.”
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