Student loan assistance is a worthwhile benefit to offer employees

While all Americans contend with historic inflation and sky-high gas prices, roughly 43 million Americans are also saddled with federal student loan debt, according to the Education Data Initiative.

Even before the COVID-19 pandemic, the United States’ outstanding student loan debt balance exceeded $1.7 trillion, becoming a larger burden to households than even credit card debt. Two years after the federal government paused student loan payments and dropped the interest rate to 0%, as many as half of people with such debt may now be at increased risk of falling behind, according to a report by the Government Accountability Office.

Watch: Fighting inflation: How companies can alleviate employees’ pain

Earlier this year, President Joe Biden extended the pause on federal student loan payments through Aug. 31. It’s the fifth extension since the moratorium took effect in March 2020 because of the pandemic. As part of his 2020 campaign, Biden vowed to alleviate student loan debt if elected, even tweeting that the government should forgive a minimum of $10,000 per person of federal student loans, as initially proposed by U.S. Senator Elizabeth Warren. “Young people and other student debt holders bore the brunt of the last crisis. It shouldn't happen again,” Biden tweeted on March 22, 2020.

Well, he’s been in office for over a year, and no such action has been taken. As a matter of fact, the Biden administration further extended in December only after increased pressure from politicians in his own party, as well as the public. It looked even bleaker for borrowers after Biden didn’t address student loan debt at all during his first State of the Union in March.

Without the federal government to rely on, employees are seeking relief from the private sector.

“Employers should really be looking at their population of workers and find out what their needs are,” Jeanniey Walden, global chief innovation and marketing officer at DailyPay, told HRD. “This helps them make better decisions in the workplace, which might mean offering stipends. Is there a way they can offer student loan debt repayment as a benefit? It really makes a difference at the end of the day.”

Learn other ways that companies are helping employees keep more money in their pocket in the latest episode of HRD TV.