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 WorkersCompanies 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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