Don’t Let Poor Credit Prevent You From Getting a Job

The unemployment rate in the U.S. has declined in the past several months, indicating that the labor market may finally start turning around. However, there are still a number of Americans who have been unable to find a job.

What’s preventing many people from getting a job is not necessarily lack of skills, but poor credit is the reason they are rejected. The use of an applicant’s credit history in a job search is not new or uncommon, though many consumer advocates say it is not a fair assessment of a person’s ability to perform assigned job tasks.

This scenario can make it more challenging for many Americans who were negatively impacted by the Great Recession to secure a job. Some workers who were laid off may have been forced to rely on credit to make ends meet, while others may have faced housing issues or costly medical bills as a result of lost health insurance.

So, how do you improve your credit during a job search?

Check your credit report: If you saw your credit standing slip during or following the recession, checking your credit report to measure your credit strength is a good first step to take. Studies show that nearly 80 percent of credit reports contain some mistakes, and 25 percent of these mistakes are serious enough to result in a denial of credit. If you check your credit report well in advance of the beginning of your job search, you will have enough time to correct any false postings that may have impacted your score.

Improve your money management skills: It’s also important that you make improvements to your money management habits. Try to pay all your bills on time to avoid paying additional fees and high interest rates. In addition, create a monthly budget to have sufficient funds to put toward your credit card payments. Doing so can add more strength to your credit and help your score receive the bump it needs.

Be honest: Lastly, you should understand that going from bad credit to good credit takes time. If you are undergoing the interview process, it’s important that you are honest with potential employers about your negative credit and the scenarios that may have resulted in your low score. While you should avoid going into too much detail, a brief explanation may help employers understand that you have acknowledged your credit card issues and you are taking steps to get back on the right track.