This Week's Herman Trend Alert

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  The Herman Trend Alert

July 26, 2012

Bribing Students to Move There

Outside of the United States, acquiring an education in your chosen profession is a financial burden mostly borne by the State. In the US, students graduate from our colleges and universities with enormous debt. Currently outstanding loans total about $1 trillion USD, exceeding the US credit-card debt. Loan repayment burdens many graduates. Now states and communities, plagued by declining populations, have embraced the idea of offering student loan repayment in exchange for moving to their areas.

The State of Kansas offers as much as $15,000 toward student-loan repayment for people who relocate to these population-challenged areas. Graduates genuinely appreciate the stress reduction and believe that the program allows them to move on with their lives, without worrying about repayment. The Kansas program has attracted 411 applicants from 33 states. The State of Missouri has a similar program.

Nearby Nebraska, concerned about the brain drain effect on their state, considered offering $7,500 over five years to student debt holders. According to the last census, more than half of Nebraska’s 93 counties have seen population declines of more than 5 percent in 10 years. However, budget concerns recently prevented the legislation from being passed. Nebraska expects to lose qualified, skilled workers to Kansas.

Some counties in Nebraska have lost as much as 22 percent of their populations in the past two decades. This exodus has left companies struggling to find labor. The problem is worse for those graduating with degrees in the healthcare professions.

Students in these professions often graduate with high debt burdens, making companies with loan-repayment plans especially attractive. Many health care systems, including Employer of Choice® Award Winner Martin Memorial in Stuart, Florida offer loan-repayment incentives and highlight them in their advertising.

In an annual retention survey by Cejka Search and the American Medical Group Association, 35 percent of medical groups surveyed had offered loan repayment to candidates in the past year. The plan helps draw and keep people in high-demand primary-care positions in rural areas and the deal works out for everyone.

We expect to see more employers around the world offering this effective benefit to attract debt-burdened young people from the US.

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