Student Loan Assistance Can Increase Employee Engagement | Edcor

Student Loan Assistance Can Increase Employee Engagement

Employee engagement is one area where employers and employees have a symbiotic relationship. What benefits employees, truly benefits their employers when it comes to engagement. However, about 31 percent of businesses see employee engagement as one of their fop five challenges, according to the 2018 SHRM GLOBOFORCE Employee Recognition Survey: Employee Experience as a Business Driver. As many as 51 percent of the US workforce in not engaged, according to the 2015 Gallup Employee Engagement survey. As many as 17.2 percent of workers are actively disengaged.

Multiple studies and reports show that employee engagement is crucial for business productivity.
• The Performance Improvement Council reported that studies by Gallup “confirm that engaged employees are more productive, create better customer experiences, and are more likely to remain with their employers.”
• In a whitepaper for The Society Human Resource Management (SHRM), Robert J. Vance, Ph.D., states, “The greater an employee’s engagement, the more likely he or she is to ‘go the extra mile’ and deliver excellent on-the-job performance. In addition, engaged employees may be more likely to commit to staying with their current organization.”
• Another Gallup study stated that “companies with high employee engagement levels have 3.9 times the earnings per share when compared to those in the same industry with lower engagement levels.”

One way employers can create levels of employee engagement that produce results is to be responsive to employee needs. “In general, employees are most likely to say they would change jobs for benefits and perks closely related to their quality of life. They are quite interested in jobs that offer them a way to balance work and home better, gain a deeper sense of autonomy and secure their financial future,” states the Gallup report The State of the American Workplace. As employers compete to recruit, retain and increase the engagement of their employees, student loan assistance is an effective way to respond to employee needs: 19 percent of GenXers and 45 percent of millennials would change jobs for this benefit.

Student debt can affect employee engagement. Having debt makes employees feel vulnerable, says MinhTran, Senior DC consultant at Willis Towers Watson. Employees are looking for benefits that help them develop security. Many younger employees are happy to save for future retirement, but they have priorities, such as paying down student loan debt, that affect them right now. This feeling of vulnerability affects employee performance and business productivity. Employees with money troubles admit their money problem affect their job performance and often prevent them from doing their best. “Financial issues affect business results by their impact on employee productivity, resulting in greater stress and absenteeism and acting as a distraction to employees engaging with their work,” says Jonathan Gardner, Senior Economist at Willis Towers Watson.

Employers who are most responsive to their employees’ needs have the most engaged employees. They will find that their employees feel less stress and can be highly engaged in their jobs. Currently only 4 percent of employers offer student loan repayment programs. This benefit differentiates an employer as one who is responsive to employee needs. Analysts predict the number of employers offering student loan repayment will increase to 20 percent in the near future.

Responsive companies offer meaningful benefits such as student loan assistance and they get positive returns. “Organizations have more success with engagement and improve business performance when they treat employees as stakeholders of their future and the company’s future,” says the Gallup State of the American Workplace.