Record high college tuition paired with a tight labor market has employers across the U.S. taking a closer look at their education benefit offerings. From long-standing benefits like tuition reimbursement to emerging trends like student loan repayment, organizations are investing in education to help attract and retain employees.
According to a new survey report from the International Foundation of Employee Benefit Plans, Education Benefits: 2019 Survey Results, more than nine out of ten (92 percent) responding U.S. organizations offer some sort of educational benefit. Of those offering benefits, the most common include:
- Tuition assistance/reimbursement (63%)
- In-house training seminars (61%)
- Attendance at educational conferences (51%)
- Continuing education courses (50%)
- Coverage for licensing courses and exams (44%)
- Personal development courses (35%)
- 529 college savings plans (10%).
More than one-half (57 percent) of organizations have had tuition reimbursement programs in place for between six and 20 years, while another 27 percent have had programs in place for 21 years or more.
Long-Standing Tuition Assistance and Reimbursement Programs Prove a Win-Win for Employers
Organizations use different techniques for reimbursing student employees. The large majority (87 percent) reimburse after the end of study if employees meet certain requirements. The most popular reimbursement amount to employees is $5,000-$5,999. If an employee leaves the organization within a year after obtaining their reimbursed education, more than half of employers (54 percent) require payback.
I spoke with Julie Stich, CEBS, VP of Content at the International Foundation. She said only 1 to 5 percent of employees take advantage of tuition reimbursement provided by their employer. This means, big picture, offering educational assistance isn’t a huge financial commitment for organizations in comparison to other types of benefit offerings. Tuition reimbursement helps to attract and retain all employees—especially younger ones who appreciate the opportunity to grow in their careers.
[Related Reading: The Scoop on 529 Plans]
Nearly a Quarter of Employers are Considering Student Loan Repayment Benefits
Only 4 percent of responding organizations offer some sort of student loan repayment assistance benefit. Two percent are in the process of implementing a program and almost one quarter (23 percent) are considering implementing a program in the future—evidence that this is a growing benefit on the radar for many organizations.
The top five barriers causing organizations to hold back on offering student loan repayment benefits include the high cost, uncertainty and complexity of implementation; resentment among employees who have already paid off their student loans; resentment among employees who have ineligible loan debt; and employee turnover after requirements for repayment have been met.
Organizations are most likely to offer student loan repayment in order to attract future talent, retain current employees, maintain or increase employee satisfaction and loyalty, keep employees current on evolving skill sets required for their role and maintain or increase innovation.
Julie added that student loan repayment is a very new benefit offering. Its short lifespan makes it difficult to measure success or anticipate a possible ROI. With high interest from employees and no firm governmental guidelines in place, it’s something to watch closely in the future.
Learn More About the Education Benefits Employers Offer
For more information check out the International Foundation’s newest report: Education Benefits: 2019 Survey Results.
Social Media and Communications Strategist at the International Foundation
The latest from Word on Benefits:
- What Retirement Plan Sponsors Need to Know About Spousal Consent and Remote Witnessing
- Legal & Legislative Reporter: Wrongful-death Proceedings Under an ERISA Plan
- Forfeiture Guidance for Retirement Plan Sponsors
- Trauma in Organizations: Mental Health
- Workplace Benefits Valedictorians: The Graduating Class of 2023 Wants These Benefits