Organizations are facing significant workforce challenges when it comes to recruiting, retaining, and training talent. Skill needs are evolving due to changing technology, and 75% of companies are reporting that it’s “somewhat” or “very difficult” to find qualified workers with the new skills they need. Their productivity and retention rates are suffering.

Employees actively want to close these skill gaps but often don’t have the financial ability to do so. This creates a significant obstacle for employers who need workers with new skill sets and for employees who want to reach higher-paying titles but can’t afford to upskill.

Our 2024 Education Index found that 74% of workers reported that they were interested in pursuing additional education or developing new skills.  Despite this, 53% have said that incurring student loan debt has prevented them from getting more education— and it’s not difficult to see why. There’s clear evidence that existing loan debt is hindering many Americans’ overall financial wellness, including delaying them from buying homes or making it hard to save for retirement.

A recent study found that 63% of HR professionals reported that financial stress decreases employee performance and engagement, which is directly tied to reduced revenue outcomes. This stress in a team member’s personal life can carry over into their workplace engagement, and a recent Gallup study estimated that low employee engagement costs the global economy $8.9 trillion annually.

As many Americans need to learn new skills but are unable to afford continued education amidst overall financial stress, education assistance programs are a critical benefit that can both improve overall employee financial wellness while also boosting your company’s retention and productivity.

How employee education assistance improves retention and productivity

Workers want to pursue additional education and skill development, but financial inability has prevented them from doing so. Employer-sponsored employee education assistance can help workers obtain critical degrees or certifications, gain valuable experience, and address emerging skill needs in evolving workplaces.

Providing strong education assistance benefits that prioritize employee financial wellness can improve employee retention and productivity in the following ways:

• Facilitate skill development: One in four organizations report that full-time positions they’ve hired for in the last 12 months have required new skill development due to organizational growth or changing tech needs. Continued education will upskill your existing workforce, which is tied to productivity.  
• Increase employee engagement: Engaged employees are more productive and retain longer, and a study from the Harvard Business Review found that 88% of respondents said education benefits can boost engagement.
• Reduce financial stress: Nearly one in ten Americans have talked to a healthcare practitioner about the impact financial stress has had on their health. High stress can cause burnout and reduce productivity.
• Gain a competitive edge: A 2025 study found that education assistance benefits were the third most important benefit to both working and unemployed Americans, so strong programs can give you a competitive edge to retain high-performing talent.
• Increased retention: Upskilling existing talent can help you develop and retain top employees for longer. Gallup found that brands that invest in employee development see 11% greater profitability, and are twice as likely to retain their employees.

How to remove financial barriers and support employee continued education

It’s not uncommon for organizations with tuition assistance programs to note low employee adoption rates. They may assume that this means employees aren’t interested or aware of the programs. However, in many cases, offering tuition assistance alone doesn’t combat other financial challenges that prevent employees from actually pursuing continued education.

Comprehensive education assistance programs can successfully promote employee financial wellness and support their continued education efforts by offering direct billing, student loan repayment options, and financial coaching.

Eliminating cash flow issues with direct billing 

Tuition assistance is the cornerstone of most employee education benefits and is perhaps the most significant in helping workers pursue continued education and upskilling.

However, offering tuition assistance alone may not allow all employees to take advantage of the program. Many education assistance programs only provide tuition reimbursement, which requires employees to pay for their tuition at the beginning of the semester and wait weeks or even months to receive reimbursement.

Waiting for reimbursement isn’t an option for workers already under financial stress; they may not be able to cover those costs even for a few months. A 2024 study found that around 25% of Americans are living paycheck to paycheck, impacting their ability to save or cover out-of-the-ordinary expenses.

Offering direct billing options to your employees is the best solution, allowing organizations to pay tuition to educational institutes directly instead of reimbursing employees later. This mitigates upfront costs for your workers and can directly increase program adoption.

Providing student loan repayment support

Student loan debt is crippling for many Americans, directly impacting both their financial health and overall well-being. Data from the Consumer Financial Protection Bureau found that 63% of student loan borrowers reported difficulty making student loan payments, with 37% having missed at least one payment.

The student loan debt burden isn’t just a challenge for workers now; it’s impacting their long-term financial health and goals. A study from Education Data found that 47% of student loan holders who delayed homeownership said their loans prevented them from saving for a down payment, and J.P.Morgan found that student loans directly hurt workers’ ability to save for retirement.

A Deloitte study found that 50% of Gen Z and 47% of Millennial respondents said concerns about their financial future were the top factor contributing to their stress, and with student loans being a significant cost for many, it’s easy to understand why.

As a result, offering student loan repayment support can be a crucial component for programs that support a worker’s financial well-being. These programs may include options such as:

• Making payments to an employer’s student loan servicer.
• Reimbursing employees for a percentage of student loan payments they made to the loan servicer.
• Matching student loan payments with a contribution to their retirement account.

This can be a powerful competitive advantage in retaining talent and relieving significant stress for your workers. It could allow employees to save more for retirement or pay off debt faster to improve their monthly cash flow to ease some financial strain.

Offering financial coaching as a key resource

The World Economic Forum found that financial literacy in the United States is around 50%, meaning half of Americans may have limited financial knowledge around crucial topics like borrowing, saving, and comprehending financial risk.

This trend carries over to student loan debt. Data from the Consumer Financial Protection Bureau found that many student loan borrowers have difficulty accessing information about income-driven repayment plan options that could benefit them. Around 31% of borrowers who had only been on the standard repayment plan didn’t know there were other plans available, and 14% reported needing help choosing a plan.

Offering financial coaching as part of your education assistance benefits can be life-changing for your workers. Coaches can assist employees with:

• Developing debt repayment plans that account for their immediate and long-term goals.
• Recommending strategies to help pay off loans faster, such as debt consolidation or using the snowball method to improve monthly cash flow quickly.
• Suggesting alternative loan repayment options that align with their financial status.
• Providing resources for loan forgiveness options.

By offering financial coaching to your employees, your organization can help them develop plans to alleviate short-term and long-term financial stress. This is an invaluable resource that some employees may not have access to otherwise— especially if they don’t have the discretionary income to spend consulting a financial advisor.

Creating holistic financial health support with comprehensive education assistance

Implementing comprehensive education benefits is more than just offering tuition assistance— it's about creating an ecosystem that supports employees' complete financial wellness.

When properly structured, these programs can benefit both employees and organizations. Employees have resources and the knowledge needed to pay off debt, pursue continued education, and work towards overall financial wellness, while organizations reap the benefits of increased productivity and labor retention amongst a newly skilled workforce. 

Creating full employee development programs can be challenging, but working with an education assistance service provider, like EdAssist, can help.