Here’s some more fuel on the financial-stress fire, particularly as it affects employees straddling student debt: A new survey by 
American Student Assistance finds more than half of all young workers worry about repaying student loans either all the time or often.
Here are some key — translated alarming — findings of the Young Workers and Student Debt survey, which polled 502 young workers (ages 22 to 33) as well as 451 human resource managers at companies with at least 100 employees:
- 40 percent report that worrying about their student loans has impacted their health,
- 55 percent would like to go to grad school but couldn’t take on any additional student loans,
- 61 percent have considered getting a second job to help pay off their student loans,
- 63 percent of young workers report that they don’t have anyone to turn to for help with regard to paying off their student loans,
- 75 percent of HR professionals report that their company does not offer any guidance or assistance regarding student loans, and
- 54 percent of young workers report that, right now, paying off student loans comes first, and they will put off saving for retirement until later.
Seriously folks, how did this burden on this nation’s young workers get this bad? And why aren’t we doing a better job of triage here?
Kevin Fudge, director of consumer advocacy and ombudsman at Boston-based ASA, says the stress these workers experience over student debt “clearly impacts their health and productivity in the workplace.”
In this editorial I wrote in November of last year, I cite a study by EdAssist in which 72 percent of all people with student debt say it impacts their daily lives, forcing them to give up on dream jobs and further education. That study also finds nearly half (49 percent) of these people saying they’re so stressed, they’d prefer help with school debt over budgeting, credit-card debt and even retirement.
Indeed, the ASA survey shows more than 90 percent of young workers would take advantage of a sign-on bonus or a company match targeted at paying back these mountainous burdens. So why do a whopping 75 percent of HR professionals say their companies offer no help or guidance?
Granted, some companies are treading into this muck and mire to try and clean some of it up. We blogged on this site about PricewaterhouseCooper’s commitment to pay up to $1,200 a year toward employees’ student loans for up to six years. And we blogged about Natixis Global Asset Management’s pledge to contribute up to $10,000 to every full-time employee who has been at the company for at least five years and has outstanding Federal Stafford or Perkins Loans. But that was 2015. And we’re still not hearing about any massive debt-help-bandwagon jumping.
Let’s hope a bipartisan bill introduced Feb. 1 in the U.S. House of Representatives called the Employer Participation in Student Loan Assistance Act does better this time around than when it was introduced in October 2015 as H.R. 3861. The proposed law would shield employers’ student-loan-repayment benefits from federal taxes, thereby opening the door to many more than just a few willing to help their employees pay down their school debt. Why didn’t this garner more support two years ago? This needs to pass.
Meanwhile, this November feature by Larry Stevens, which I mention in my editorial, cites a new approach some employers are taking for all their financially stressed employees: paying them pre-paycheck for the income they’ve already worked for — in other words, the hours they’ve already accrued. As Ijaz Anwar, the co-founder and chief operating officer of one of the suppliers behind this approach, San Jose, Calif.-based PayActiv, told me:
“Why can’t you just give people [living paycheck to paycheck] what they have earned, what is rightfully their, when they so desperately need it [and when it can mean] dignity for these struggling people who can’t even qualify for a credit card?”
But, sadly, there again, there’s no flood of employers taking this approach. Not sure why, when the benefits include better health and productivity for employees, and there don’t appear to be any negatives.