Don’t Let Your Credit History Hamper Employment Opportunities

It isn’t bad enough that dealing with debt can contribute to physical and emotional problems, it can now impact your chances of being offered a job in the future. More specifically, the impact debt has on your credit report will play an important role in whether or not you are hired for certain jobs. In a struggling economy, more and more employers are running a credit check on potential employees before offering them job positions. Ironically, people in debt need a job in order to get their finances back on track, however many employers are not willing to risk hiring an individual who appears to have difficulty managing money. The reasons are obvious if the position you are seeking involves money management, but other job offers can be lost that don’t revolve around money. Traditionally, credit checks have been done to gauge a potential employees reliability and responsibility. The theory is this, if you can’t be counted on to pay your bills on time, what other areas will you be found lacking in?

Of course the danger of employers using credit history to determine whether or not a person gets a job, is that a downward spiral of indebtedness will ensure. Without employment, a person struggles to pay bills, which in turn affects their credit history, which in turn is used again in the future to determine if they qualify for a job. With more companies requiring a credit check on potential employees, the 6.4 million Americans who are currently unemployed face a stark future, especially if they have fallen behind on their bills.

Another concern is the fact that many people who have not missed a payment are also seeing their credit score decline as a result of decreased or canceled credit card accounts. In this instance, an employer could actually decline a position based on a credit history that is not showing the big picture. The same can be said if there are errors on a credit report which could take up to two months to correct. In that time, the decision has already been made and the damage done for the job candidate.

To minimize the chances of having your credit history reduce your job opportunities you must pay close attention to the information provided there. Review your credit report three times annually (free of charge) to spot inaccurate information and correct it as soon as possible. If debt is impacting your credit, take every available step to reduce debt or work with creditors to lessen the impact on your credit report.