As nonprofit healthcare systems face compounding challenges—budget constraints, staffing shortages, and burnout—one federally funded benefit has emerged as a proven tool to retain top talent and lower turnover costs: Public Service Loan Forgiveness (PSLF).
Student Debt Is Quietly Shaping the Workforce—and Driving Turnover
More than ever, healthcare professionals are making career decisions based on financial stability. The median debt for medical school graduates sits at $205,000, and similar debt levels exist for nurses, therapists, and other frontline professionals. This financial burden is shifting how employees weigh job opportunities—especially in nonprofit systems where compensation may not match private sector salaries.
In PeopleJoy’s survey of over 1,000 healthcare professionals across four nonprofit hospital systems, 78% of PSLF participants reported lower financial stress, and 65% had remained in their current roles for at least five years. For comparison, just 43% of non-PSLF participants had similar tenure.
PSLF Isn’t Just a Benefit—It’s a Retention Strategy with Measurable ROI
When implemented correctly, PSLF does more than relieve debt—it transforms the employee experience. From improved morale to reduced attrition, the benefits are both emotional and economic.
Survey results show:
- 71% of healthcare workers considering a job change cite student loan assistance—including PSLF—as a deciding factor.
- Healthcare systems offering PSLF support experience up to 30% lower vacancy rates.
- 93% of employees, regardless of tenure, say PSLF access increases their likelihood of staying with their current employer.
Whether for new hires or seasoned professionals nearing their forgiveness threshold, PSLF acts as a powerful anchor in long-term workforce planning.
Why Healthcare Workers Are Staying—And Why They Leave Without It
The data paints a stark contrast:
- 81% of former employees who left PSLF-eligible roles reported financial hardship afterward.
- 65% regretted leaving, while 72% said loan payments became overwhelming after moving to a non-eligible position.
- Employees with high student loan balances are significantly less likely to pursue travel roles like locum tenens or travel nursing if PSLF is offered at their current job.
For healthcare employers, this means PSLF support isn’t just a recruitment tool—it’s a retention shield. When staff see a clear, attainable path to debt forgiveness, they’re more likely to commit, stay, and advocate for your organization.
Beyond Nurses: PSLF Has Cross-Role Impact
While frontline staff and nurses show the strongest PSLF advocacy—49% and 37% respectively rated PSLF as highly valuable—support is widespread. Even among executive respondents, 60% view PSLF as a critical benefit.
High participation and broad enthusiasm indicate that PSLF is not limited to a single job class. It’s a system-wide culture asset, reinforcing loyalty across clinical and non-clinical departments.
Workforce Stability Begins with Financial Security
Healthcare systems that support PSLF participation aren't just reducing turnover—they’re building sustainable workforce pipelines.
PSLF:
- Improves job satisfaction through reduced financial anxiety
- Decreases burnout and boosts performance
- Provides long-term incentives that private employers can’t replicate
- Fosters equity, especially for underrepresented staff with higher debt burdens
And in today’s landscape of budget reviews and benefits optimization, PSLF offers something rare: low-cost, high-impact retention.
From Policy to Payoff: Removing Barriers to Access Is Key
Despite its benefits, PSLF is underutilized—60% of applicants struggle with eligibility requirements, and 47% experience delays. These friction points can limit the program’s impact unless employers step in to streamline the experience.
That’s where solutions like PeopleJoy make a difference—by offering expert guidance, compliance assurance, and automated documentation support. The result? More employees qualify, apply, and receive forgiveness.
Stabilize Retention, Save Money, Support Mission
The findings are clear:
- PSLF enhances workforce stability.
- It reduces turnover costs.
- It boosts employee morale.
- And it gives nonprofit systems a compelling advantage in recruitment.
By investing in PSLF administration and employee education, healthcare leaders can meet budget goals while building a loyal, future-ready workforce.
Learn how PeopleJoy can help your system implement a turnkey PSLF support program that drives measurable retention gains.
📞 Call us at (844) 937-6566
🌐 Visit www.peoplejoy.com
📅 Book your strategy call today.
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