Job Applicant Credit Checks by Employers on the Rise

Personal credit history - not years of valuable experience - may be the single deciding factor in your ability to get new work.

Background Credit Checks On The Rise

According to a recent survey by the Society for Human Resource Management (SHRM), the number of employers conducting credit checks on prospective employees has now risen to 47% from the 42% conducting checks in 2006.

To make matters worse, if an applicant has long-term credit history problems, these problems will be around to haunt them for years to come. SHRM's Mike Aitken states, "Companies typically look back over a period of years for patterns in applicants' behavior. It's a longer-term snapshot to see if that's indicative of fiscal responsibility."

While most employers conduct background credit checks for work involving financial responsibility (for example, budgeting, accounting, or positions handling sensitive credit-card information), almost half of the survey's respondents are checking candidates applying for senior and executive postings.

Credit Checks Considered Unfair

Critics of the growing credit check trend contend that credit background checks foster an unfair "snowballing" effect for individuals already suffering from credit difficulties. It bars applicants most needing new jobs from getting them.

Fortunately some lawmakers are endorsing changes to reduce or eliminate background credit checks. US Representative Steve Cohen (Dem.- TN) has put forth a bill prohibiting credit checks used for the hiring or firing processes, excepting special circumstances. Other states have passed or are proposing new laws limiting credit background checks.