The student debt crisis in the U.S. is set to take center-stage once again, as the COVID-related forbearance period on federal loans comes to a close. Employees will be eager — and desperate — to work for organizations that offer benefits designed to reduce this burden.
For healthcare workers, that help is even more crucial: healthcare workers tend to leave school with student debt up to six-figures, with doctors managing average debt loads of $241,600, according to research from the Education Data Initiative, a research organization that collects and organizes data and statistics about the U.S. education system. Nurses can be hit with student debt upwards of $50,000.
As this profession faces labor shortages in the wake of COVID, McLaren Health, which operates 15 hospitals in Michigan, has added the
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“This is something we thought was a very good offering to recruit new staff and help retain our current staff,” says Todd Burch, president and CEO of McLaren Northern Michigan. “It’s also a great way to put some tax free dollars in the pockets of our team members.”
The McLaren Northern Michigan hospital branch has about 1,300 employees. Each hospital in the system is designing their program a little bit differently to meet the unique needs of each of its employees.
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“We're doing a monthly contribution over the course of three years,” Burch says. “We're going to be doing $200 a month for the first 12 months, $300 a month for the second 12 months, and $400 a month for the third 12 months.”
Student loan debt in the U.S. has ballooned to $1.7 trillion, according to the Federal Reserve. Michigan borrowers have an outstanding balance of $51.4 billion, compared to Utah, where borrowers carry a combined $10.2 billion in student loans, according to data from Student Loan Hero.
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Despite these numbers, only 8% of employers offer their employees a student loan benefit, according to the Society for Human Resource Management. However, employers are beginning to understand the appeal: student loan benefits are a proven recruiting and retention tool, which is especially necessary for hard-hit industries like healthcare, says Goodly CEO Greg Poulin.
“In the midst of the pandemic and severe national shortage of nurses, Goodly's clients in the healthcare field have reported student loan repayment benefits help them hire faster and retain longer,” Poulin says. “The student loan repayment benefit from McLaren Health has the average nurse on track to repay their student loans 30% faster than they otherwise would on their own.”
