2 Educational Benefits to Offer Alongside Health Insurance
Strong economies and tight labor markets increase competition among employers for top talent. Under the right conditions, employers are left to compete by offering higher salaries and better benefits packages. It is the latter that this post will focus on. More specifically, it will focus on two educational benefits employers can offer alongside health insurance.
It’s no secret that benefits play a big role in recruiting. When salaries are comparable, job seekers turn to benefits as the determining factor. The company offering the best benefits package wins. As a company owner or HR manager, wouldn’t you prefer that your company be on the winning side more often than not?
At Dallas-based BenefitMall, benefits administration is a big part of what they do for their clients. They say that two of the hottest benefits right now pertain to education. These are student loan repayment and tuition reimbursement benefits.
Student Loan Repayment
The typical college graduate enters the labor market already tens of thousands of dollars in debt. What you might not know is that student loan debt continues for years after graduation. Among the 44 million Americans still paying student loans, some 35% are over the age of 40. They account for almost one third of all the outstanding student loan debt.
According to USA Today, research data shows that 62% of U.S. workers with outstanding student loans would consider making the move to a different employer in order to get access to a repayment benefit. Newly graduated students display a similar tendency. More than 60% say that they would prefer to work for an employer that offers some sort of student loan assistance.
USA Today also says that only about 4% of America’s employers offer debt assistance programs to new hires. Yet it would appear as though more than one third are interested in changing that. Is your company among them? If not, management might want to reconsider its position.
The tuition reimbursement benefit actually is not new in the U.S. Companies have been offering it for decades. It’s catching on now based mainly in the desire for companies to enhance the workforce by encouraging continuing education. Simply put, companies are willing to help pay for continuing education because they believe it makes workers better.
One company might offer to cover the cost of tuition fully whenever an employee seeks continuing education directly related to his or her job. Others give workers more freedom to choose educational programs and, in return, only pay for a portion of the cost.
Tax and Reporting Implications
BenefitMall says the biggest concern for employers is how to handle such benefits in relation to taxes and reporting. Federal and state laws treat benefits packages differently depending on how those benefits are actually offered. Implementing student loan repayment or tuition reimbursement benefits could substantially complicate things for the payroll department.
Third-party payroll providers like BenefitMall already have this sort of thing worked out. They know how to report the benefits. They know how to handle tax issues. They are already equipped to ensure employers maintain compliance even in the midst of offering benefits to employees.
As things stand, America’s employers are facing a very tight labor market. There just aren’t enough workers to fill all of the open jobs. As such, employers are having to compete for their industry’s top talent in whatever way gives them an edge. For some, that means offering student loan repayment and tuition reimbursement benefits. Both are benefits that make it easier for workers to swallow the high cost of education.