Some Companies Now Trying to Attract Workers With Offers to Pay Student Debt
“Offering education compensations makes workers feel appreciated”
This is a win win. If a company can afford to do this to attract better workers, more power to them.
The Daily Caller reports:
Student Debt is so Massive Companies Are Using it to Lure New Workers
Companies competing with each other in a tight labor market are using student loan debt to recruit potential employees by offering to pay for education and repay student loans among other benefits.
Tight labor markets — when there are more jobs than workers — benefit workers because employers will make accommodations to recruit and retain employees. The accommodations can include flexibility in schedules, increased compensations, offering more benefits and spending more time and money on training, according to Marketplace.
Offering education compensations makes workers feel appreciated, according to Deniz Gevrek, associate economics professor at Texas A&M University, Corpus Christi, The Wall Street Journal reported Wednesday. Increasing salaries would also be more costly.
Student loan debt is $1.5 trillion and increasing, according to the Federal Reserve, reported WSJ.
Abbot Laboratories, a health care company that hires over 1,000 college-educated people under 35 each year, contributes 5 percent of worker salaries into a 401(k) if employees pay at least 2 percent of their gross salaries to student loans. The plan was started in the summer, according to WSJ.
A 401(k) is a retirement plan sponsored by employers where employees delay receiving a certain amount of their salary. The delayed amount goes into the retirement plan and the deferred money is not taxable until distributed, according to the Internal Revenue Services (IRS).
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Comments
Clever. Now let’s hope the illegal alien and legal immigration spigot gets turned off, so that employees continue to have leverage to get better pay.
“…a health care company that hires over 1,000 college-educated people under 35 each year…”
I guess older people don’t count.
Unfortunately, the Daily Caller article doesn’t say anything much about paying student debt.
There’s some fluff about 401(k)s, or money which can’t be touched until decades after the student’s dept is paid off by other means. So no help there.
And there’s mention of some programs paying a part of a student’s new debt if taking courses which might be of advantage to the employer. Far more generous programs than that have been fairly common for at least fifty years.
Anybody who’s worked enough to have gotten over the novelty of the whole thing isn’t all that interested in “feeling appreciated” if it’s a choice between that and the cash.
Is it just me, but didn’t this used to be pretty common? I remember at one time ever WalMart’s Manger Program offered Tuition Reimbursement if you passed muster. Now some companies didn’t call it that, some called it a “signing bonus”, but the bonus happened to be the same amount as you owed in loans.