With Millennials now outnumbering any other generation in the workforce, it comes as no surprise that HR departments are now having to rethink how they can more effectively attract and retain staff from a workforce that is graduating with substantial debts.
Employers lending a hand
US-based ChowNow is among those that have already offered such an incentive. Christina Lin, a graphic designer for the company, has said that her debts are now half of what they were just six months ago.
It’s a small start; according to the Society for Human Resource Management, just 3 per cent of employers assisted in loan repayments last year, and the survey results were gleaned from more than 460 HR managers, so it’s not an insignificant sample size.
The tide is changing however, with more globally recognisable companies beginning to see the benefit in creating an additional attraction for Millennial employees. Later this year, New York-based PricewaterhouseCoopers is planning to help some employees with student debts, offering as much as $1,200 a year for a maximum of six years.
Software company Kronos Inc. and Natixis Global Asset Management will both be offering assistance. Software giant Microsoft Corp. has the option for employees to refinance student loans with a discount on interest rates as part of an on-going relationship with online lender SoFi, reducing the burden for graduates entering its workforce with significant debts.
A generation crippled by debt
Research conducted in the US by the Project on Student Loan Debt revealed that the class of 2014 graduated with an average of $28,950 in loan debts (up 2 per cent). Similar figures are seen worldwide; in 2014 the BBC reported that research from the IFS estimated that the average debt of a graduating student in the UK is in excess of £44,000.
This level of debt is inevitably having an impact on how graduates search for work, with the undeniable pressure of huge numbers hanging over them for years ahead. Schemes that help with these debts may be the key to creating a strong relationship with a new pool of promising workers according to some.
ChowNow’s CEO Christopher Webb admitted that it can be hard to find genuine talent in a competitive market, and the added appeal of loan refinancing adds an extra incentive that HR departments can’t afford to ignore.
While it may be a while before student loan refinancing is commonplace world-wide, with prospective employees being urged to consider their options, the earliest reports of schemes are thus far promising for the largest working generation.
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