Bad Credit Killing Your Job Chances?

A new report from the nonprofit advocacy group, Demos, claims 1 in 7 Americans are denied jobs because of negative information on their credit report.

Once a rare occurrence in the job screening process, a 2010 report by the Society for Human Resource Management found that 47% of firms now run credit checks on job applicants.

Is there a connection between bad credit and bad employees?

Not necessarily says one of the nation’s largest credit Bureaus. In testimony before the Oregon State Legislature Eric Rosenberg, Director of State Government Relations for TransUnion, stated “At this point we don’t have any research to show any statistical correlation between what’s in somebody’s credit report and their job performance or their likelihood to commit fraud.”

Federal law allows the use of credit checks by employers during the hiring process. However, according to the National Law Review, seven states have outlawed this practice and another nineteen have similar restrictions under consideration.