Last month, U.S. Senators John Thune and Mark Warner introduced a bill with guaranteed bipartisan appeal. The Employer Participation in Repayment Act provides employers with a tax break, for giving employees up to $5,250 a year to pay their student loan debt.
Some employers are already providing some assistance to their workers, but with a tax break in line to incentivize them, the number of participating employers is sure to grow.
Tuition.io works with a variety of companies—from startups, to small businesses, to Fortune 500 companies—to provide an employee benefits platform that allows for student loan contributions.
In light of the senators’ action, CEO Scott Thompson released a statement, which reads in part, “This bill is not only a clear win for employers and employees, but it will also help stimulate the growth of the entire economy.”
According to a Tuition.io spokeswoman, 86% of employees say they would stay with a company for at least five years, if their employer helped pay down their student loans. Yet, only 4% of companies currently offer that benefit. That percentage is expected to grow, however, to 26% by 2018.
I spoke with Thompson by e-mail to learn more.
BLACK ENTERPRISE: What industries are making use of this benefit?
Scott Thompson: The great thing about this benefit is that it’s applicable, across the board, to various industries and companies, especially any company that utilizes the millennial workforce.
Millennials currently make up a third of the American workforce, and that number is quickly rising. Never before has such a large percentage of the workforce been burdened with levels of debt from their education, which has a direct impact on their ability to pay their bills, save for retirement, and stay in the jobs they love.
Studies have shown that millennials value student loan repayment assistance over any other workplace benefit. Offering student loan repayment as a benefit is a smart, positive ROI investment for employers to make.
BE: Does Tuition.io customize its student loan contribution platforms?
ST: Tuition.io customizes its platform for companies, and then manages the technology for employers and employees that sign on. The employer chooses a customizable program and contribution amount. Employers can contribute a fixed amount on a monthly basis and can opt to increase after select milestones. They can also offer the benefit in a highly targeted way (think tenure, business unit, and so forth), or to their whole team, as an inclusive way to increase employee engagement. They have complete control of their program.