WASHINGTON, June 15, 2016 /PRNewswire/ -- Securing a great job in today's competitive labor force requires education, skills, tenacity, and persistence. But how many people know that their financial histories may affect their appeal to potential employers? The National Financial Educators Council (NFEC) conducted a survey to find out.
In a nationwide poll cosponsored by the NFEC, HR Management Solutions and the Financial Literacy Action Network, adults aged 35 to 54 were asked the following questions: 1) "Have you ever been turned down for a job or promotion as a result of your credit or financial background?" and 2) "Has an employer or potential employer ever conducted a credit or financial background check as a condition of hiring you or giving you a promotion?" Analysis of the responses paints a troubling picture. Of the 1,165 who responded to the first question, 5.2% stated that they had been turned down for a job due to their financial profiles (with 18.2% responding "not sure"). Among the 1,100 who answered the second question, 26.3% reported that an employer had checked their financial background (29.8% said "not sure").
Complete survey results may be accessed at https://www.financialeducatorscouncil.org/financial-background-check-surveys/.
Further, the results suggest differentials based on gender, age and area of residence. Among women who answered the survey, 61.6% of those aged 35-44 reported having had their credit backgrounds checked as a condition of employment, compared to 48.9% of women in the 45-54 age group. And women residing in rural areas were more likely (37.6%) to answer "yes" to this question than were women who live in the suburbs (21.1%).
This study is interesting in light of recent indicators that a sizable proportion of U.S. employers use credit checking as part of the applicant screening process. In 2012 the Society for Human Resource Management reported that 47% of U.S. organizations check credit history for at least some positions. The leading reasons companies reported for doing credit checks were to prevent theft or embezzlement, and to reduce legal liability for negligent hiring. Although the Fair Credit Reporting Act stipulates that employers must obtain prior applicant consent for a credit check, refusal to give such consent would likely cast the applicant in a negative light regardless of his or her credit background.
The NFEC poll was conducted in collaboration with HR Management Solutions and the Financial Literacy Action Network both led by Brandy Speer. Speer, a Certified Financial Education Instructor, assists entrepreneurs to protect and grow their business; a key component of her efforts is on providing personal money management skills to employers and employees.
The current financial literacy survey is one component of a larger research series conducted by the National Financial Educators Council and its collaborators to explore relationships between financial attitudes/behaviors and levels of financial capability. The NFEC – resource provider, industry advocate, and thought leader in the financial education space – conducts research and hosts think tanks around topics related to improving financial wellness among a global population. This independent, full-service financial literacy organization adopts a social enterprise business model, and gathers empirical data for the purpose of sharing best practices with other leaders in the field.
The National Financial Educators Council is a financial education resource provider, industry advocate, and thought leader. The NFEC conducts surveys, studies, and research and hosts think tanks around topics related to financial education. The objective is to gather empirical data to uncover best practices to share with colleagues in the financial education industry.
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SOURCE National Financial Educators Council