Student loan benefits highlight the workplace diversity gap

As employers work to create a more diverse and inclusive workforce, student loan benefits can be a critical component to closing the diversity gap and helping marginalized workers meet major milestones in their lives.

Student debt is disproportionately held by underrepresented employees. Black graduates owe an average of $25,000 more in student loan debt than white college graduates, according to research from EducationData.org, a resource for information on the U.S. education system.

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To address these discrepancies, healthcare tech company ConsejoSano has added the Goodly student loan benefit to its suite of offerings. The Los Angeles-based company just crossed the 100 employee threshold.

ConsejoSano — which means healthy advice in Spanish — will make monthly payments to its employees’ student loans based on their tenure with the company. Workers with a year or less time with the organization will get $50 a month towards their debt. Employees with one to two years of service will receive $100 per month, those with two to three years at the company will get $200 a month and employees with three years or more will receive $400 a month.

The company decided to offer the Goodly benefit when the higher ups realized that their workforce is made up of individuals who are most disproportionately impacted by student loan debt.

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“Our team is comprised of about 80% women and about 75% first generation and second generation immigrants,” says Vikram Bakhru, chief operating officer at ConsejoSano. “[This benefit] is particularly relevant to our team and our focus and mission as a company.”

Women hold nearly two-thirds of the nation’s trillion dollar student loan debt, according to research from the American Association of University Women. Additionally, the median Latinx borrower still owes more than 80% of their student loan balance 12 years after graduating, compared to the median white borrower who owes 65% at the same point, according to a study from the Student Borrower Protection Center.

“Underrepresented employees are starting their careers with larger debts to repay, which delays their ability to achieve financial goals, including saving to buy a home, building retirement savings or otherwise accumulating wealth,” says Greg Poulin, CEO of student loan benefit provider Goodly. “Employers are increasingly recognizing that their traditional benefits offerings are often out of touch with a workforce that now consists primarily of millennial and Gen-z employees.”

Despite the prevalence of student loans, just 8% of employers offer any kind benefit to help tackle the issue, according to the Society of Human Resource Management. As the nature of work evolves, employees are becoming more vocal about what they expect their employers to do for them. Student loan benefits are the third most in-demand benefit among millennials, after health insurance and paid time off, according to a survey by the American Institute of CPAs.

As employers become more aware of the effort they need to put into their diversity and inclusion efforts, it is vital for them to offer benefits that will help employees who are unfairly and unequally burdened by debt.

“Student loans have increasingly come to be seen as a diversity, equity and inclusion issue because student debt is disproportionately held by underrepresented employees,” Poulin says. “Virtually all of our new clients credit student loan paydown for contributing to the diversification of their workforce and helping to build a diverse talent pipeline.”