Today, student loans play a significant role in determining how and where Americans are seeking employment, spending money, and saving for their future. Though loans have helped many to earn their degree, borrowers continue to find it difficult to keep up with monthly payments – averaging $300 per month – on top of other monthly expenses.

U.S. student loan debt has reached an all-time high and now stands as the second-highest consumer debt recorded at $1.5 trillion among 44.7 million borrowers.[i] Although student debt primarily impacts younger generations, it is not a burden faced strictly by millennials who are at the beginning of their careers. In 2018, Americans over the age of 50 owed more than $260 billion in student loans, and this number has continued to grow.[ii]

It is estimated that by 2025, millennials will make up about 75% of the U.S. labor force. We are already experiencing the impact of this shift in the working population when it comes to desired pay and benefits. People are looking beyond salary and instead evaluating a company’s complete benefits package when choosing employment. Many job seekers have begun to show interest in benefits beyond the traditional offerings, such as student loan repayment assistance.

A student loan repayment benefit offers assistance from employers to help pay down student debt. Typically, payment programs are easy to implement and require little maintenance by employers. The most common approach is through monthly contributions from employers, which can be a flat amount or matched to payments of the employee. Depending on the company, requirements, and limits to which an employer contributes can vary. However, there is no required maximum contribution for employers, which means organizations can use this to their advantage in many ways.

Employers are now listening to the need for assistance as they are beginning to feel the impact of financial stress on recruitment, retention, and employee productivity. With a low unemployment rate in the U.S. today, employees now have an advantage that allows them to be selective when choosing where to work. Employers must remain competitive to differentiate themselves to attract and keep top talent. Younger generations are actively seeking out job opportunities that offer not only financial security, but according to an ASA survey, 86% of employees said they would commit to a company for five years if the employer helped pay back their student loans. For employers, offering a unique and less common benefit like this shows an investment in the wellbeing of their people.

Not only do these programs help to attract top talent, but also keep employee retention high. Many companies struggle with retaining employees due to younger generations changing jobs every few years to chase a higher salary. And although such benefits may first appear as an additional cost, this cost does not compare to the ultimate price of losing vital employees. It is a worthy investment to keep talent. Employees respond to positive recognition and at the end of the day, those who feel valued and cared for in the workplace are likely to stay.

Employer-based student loan debt assistance can have a significant financial impact on employees. Not to mention the relief of financial stress on their physical and emotional health. By helping to eliminate the pressure and burden of student loans, employees, as a result, will be happier and more productive. This benefit can also allow for many to pursue opportunities and financial goals that were unattainable before, such as buying a house, saving for retirement, or starting a family.

Although student loan repayment programs remain uncharted territory for many employers, they may be worth exploring. Participation by employers in this benefit has doubled in the last year, from 4% to 8%, and is predicted to grow according to the 2019 Employee Benefits Report provided by SHRM. Student loan repayment benefits can offer significant opportunities to both employers and employees and are likely to become more prevalent in coming years. If you have any questions feel free to email us at or give us a call at 585.248.5870. Stay up-to-date with our blog posts by following us on LinkedIn or Facebook!