Dive Brief:
- Student loan repayment is becoming a popular benefit offered by employers. But, at the same time, employers must address skill shortages with training programs. Chief Learning Officer explored where employers might find the better ROI.
- From an employee retention point of view, it can cost as much as six to nine months of a departing employee's salary to replace them, therefore, finding the right mix of benefits to keep employees happy is critically important. Implementing world-class professional development programs that keep a large segment of skilled employees engaged in career growth may provide a greater ROI overall than other benefits. Chief Learning Officer said the answer may lie in "all-you-can-eat professional development programs."
- Data from a 2016 Gallup poll indicated that 87% of millennials think career development is important, and a Corbett Inc., report said that 76% of employees are seeking opportunities for career growth, Chief Learning Officer noted.
Dive Insight:
Americans are saddled with nearly $1.4 trillion in student loan debt. It's no surprise then that some companies have offered to pay this debt on behalf of employees in an effort to sweeten benefit packages. But, is there any real ROI for businesses that do this? Many argue that it's far more beneficial to invest in professional development, which creates a more skilled workforce. These new skills can help individuals to advance and earn more money, which can be used to pay down debt. It also aids with employee retention rates, because when employees know their employer is willing to invest in their future success they are more likely to stick around.
Student loan repayment is likely to be popular with a specific, somewhat limited, subsector of the workforce: namely young employees in fields that don't have high salaries. This may make this option something to consider for employers with a workforce that skews younger.
However, based on employee interest in professional development, a focus on offering employees robust learning opportunities has broad appeal across the whole workforce, providing a much clearer ROI for employers. A third option — for employers who can afford it — could be to choose an "all of the above" approach to benefits offerings, allowing workers to choose which of these premium benefits are most beneficial. Employers also shouldn't forget about benefits that will appeal to more seasoned workers at later stages in their career. For a worker nearing retirement, a robust 401K offering is likely to resonate better than a loan forgiveness. Properly constructed training programs, however, could appeal to workers of all career stages.
