Student debt is only growing in the U.S., so it comes as no surprise that it's an issue that demands recognition across all industries. What is surprising is how much the size and scope of debt varies by industry. For example, in the automotive and manufacturing industry, fewer workers may carry debt, but many of those who do have it have to deal with huge balances. As a result, employees with debt in the industry are roundly demanding benefit packages that address it.
As part of the new white paper, "The Missing Benefit in Financial Wellness," CommonBond surveyed more than 1,500 employees and 500 human resources executives across five different industries. The information that we gathered proved just how crucial student loan benefits are to addressing the debt of workers in the automotive and manufacturing industry.
The Whole Story
What makes student loan debt deceptive in the automotive and manufacturing industry is that it doesn't look widespread on the surface. In CommonBond's survey, only 35 percent of workers in the industry reported carrying student debt for their own educations. Of the five industries CommonBond analyzed (retail, healthcare, finance/insurance/professional services, and technology), that was the lowest percentage.
That number may seem encouraging, but it's very misleading — those who do carry student loan debt in this field often carry it in extremes. As technology becomes more sophisticated, more jobs in the industry require advanced degrees, and those carry hefty price tags. Of employees with debt, 49 percent initially took out at least $50,000. Nine percent first took out a staggering $150,000 or more.
Clearly, a simple check on what percentage of automotive/manufacturing employees carry student debt doesn't tell the whole story. Those with debt have large amounts of it, it causes them great difficulty, and they're in danger of being overlooked if employers think of the industry as a whole as light on student loan debt.
An Opportunity to Help
For automotive and manufacturing employees with student loan debt, it's consuming. That's proven by the fact that 52 percent of employees carrying student loan debt, when asked what financial wellness benefit they'd most want, chose loan repayment. Despite the presence of other options, including identity theft protection, emergency loans, repayment of future tuition, and financial planning and budgeting, loan repayment was the overwhelming favorite — more respondents with debt picked loan repayment than the other choices combined. That's proof positive that student debt can feel pressing.
Thankfully, there's hope. An overwhelming 95 percent of human resources executives in the automotive and manufacturing industry believe their companies should take an active role in helping employees deal with their debt. Since student loans are such a huge concern for many workers in the industry, it only follows that addressing it is a starting point when it comes to assisting them. As a result, 54 percent of those same human resources executives are planning on incorporating student loan-related benefits packages at their organizations within the next three years.
A Plan for the Future
Benefits packages are always evolving, but for them to have the greatest possible impact as they grow, human resources executives need to center their innovations around their employees' concerns. If employers in the automotive and manufacturing industry take the needs of all of their employees into account as they update their benefits programs, they'll be able to create the most effective and helpful kinds of compensation.
For student loan debt, that means a multi-pronged package for getting employees financially healthy — one which includes instituting repayment benefits that chip away at their balances, implementing educational programs that help them manage their debt over the long term, and offering low rates on future student loans to prevent debt before it starts. To learn more about how making such a package part of a benefits offering, check out CommonBond for Business's suite of student loan benefits for companies.
Want to know more about the effects a student loan benefits package can have on your employees? Download "The Missing Benefit in Financial Wellness."