Want A New Job? First… Check your Credit!

Financial Values & Work-Life Balance

Credit Problems May Hinder Job Search

When you are searching for a job, demonstrating relevant experience and acing the interview are important. But they may not be enough to secure the position. Regardless of the type of job you are seeking, you could be turned down by an employer if you bounced some checks at some point or were late in paying your bills. Concerned about theft and liability issues, growing numbers of employers are running credit and other background checks on job candidates before making offers of employment.

Employers are permitted by law, with some restrictions, to conduct background checks on job candidates during the hiring process and when evaluating current employees for promotion, reassignment, and retention. In an effort to minimize their own risk for theft and liability, it is increasingly common for employers to compile a consumer report detailing a job candidate?s personal and credit characteristics.

While screening job candidates for credit problems has long been routine in banking and financial services, the practice is now spreading to other industries. According to a recent survey conducted by the Society for Human Resource Management, 60% of private employers check the credit histories of some of their job applicants, and 13% check the histories of all potential hires. Also, 10% of unemployed Americans have been denied a job because of data in their credit report.

Why do employers investigate a job candidate’s credit history? Some employers may be concerned that an employee with financial problems may be tempted to steal, especially if the employee handles money. Employers may also view an employee who is under financial pressure as a security risk, subject to bribery, and vulnerable to offers from competitors trying to buy confidential information. In addition, employers may view a history of bad credit as a sign of irresponsibility that could be indicative of the candidate’s future job performance.

Before embarking on your job search, request copies of your credit report from the three nationwide consumer credit reporting companies: Equifax, Experian, and TransUnion. With identity theft on the rise, it has become more important to remain vigilant about your personal credit records. You are entitled under Federal law to request one free credit report a year from each of these credit bureaus. To order your reports, go to www.annualcreditreport.com, or call the Annual Credit Report Request Service at 1-877-322-8228.