Many companies are adding, expanding tuition assistance so workers can go back to college
- Tuition assistance may be the most valuable incentive companies are using to attract and keep workers.
- For employees, tuition assistance can be a game changer.
- Big corporate names including Walmart, McDonald's, T-Mobile and Amazon have programs that help cover the cost of going back to school.
As a growing number of Americans feel priced out of a college education, tuition assistance may be the most valuable incentive companies are using to attract and keep workers.
In the last few years, more businesses have added or expanded benefit offerings of free college programs. Not only does free or discounted higher education improve recruitment and retention, it also cuts down on student debt while advancing the long-term well-being of employees, experts say.
Big corporate names including Walmart, McDonald's, T-Mobile, Amazon, Home Depot, Target, UPS, FedEx, Chipotle and Starbucks have programs that help cover the cost of going back to school. Waste Management will not only pay for college degrees and professional certificates for employees, but also offers this same benefit to their spouses and children.
More from Personal Finance:
98% of workers support pay transparency
Companies are slashing parental leave benefits
Here are the 'most employable' college degrees
Of course, employers paying for their employees to get a degree is not new. For decades, businesses have picked up the tab for white-collar workers' graduate studies and MBAs.
However, many companies are now extending this benefit to front-line workers, such as drivers, cashiers and hourly employees, as well as heavily promoting the offering more than they have before.
Coming out of the Covid-19 pandemic, these types of benefits play a big part in the competition for workers and more companies are now offering opportunities to develop new skills, according to the Society for Human Resource Management's 2022 employee benefits survey.
To that point, 48% of employers said they offer undergraduate or graduate tuition assistance as a benefit, according to the SHRM survey. A separate survey from Willis Towers Watson in 2021 found 80% of large employers offer tuition reimbursement.
Programs can open 'career paths to higher-paying roles'
"I thought about college, but I didn't think I had the resources to work full time and go to school," said Tara Sims, 39, an associate at a Walmart store in Fayetteville, Arkansas.
Sims is now almost a year into a bachelor's degree in business administration through Walmart's Live Better U education program. Sims, who will be the first person in her family to complete college, said she was motivated by her 12-year-old daughter, Brylie.
"I actually made the honor roll last fall and sharing that email with her was really exciting for me," Sims said.
Five years ago, Walmart unveiled an ambitious educational assistance plan for its workers. Then, in 2021, the country's largest employer said it would make the program entirely free for all full- and part-time associates, covering 100% of college tuition and book costs.
"Our higher education system is in trouble right now," said Lorraine Stomski, senior vice president of learning and leadership at Walmart. "We just keep doubling down on the programs that are going to unlock those career paths to higher-paying roles."
Over the last five years, the company has helped employees save nearly half a billion dollars in what otherwise would have been student debt, she estimated.
About 104,000 associates of Walmart and its Sam's Club subsidiary have participated in the Live Better U education program so far, the company announced Thursday.
Those employees are two times more likely to be promoted and four times less likely to leave the company, according to Rachel Romer, CEO of Guild Education, Walmart's partner for the program.
"Our goal is to create career mobility," Romer said, and "Walmart has also inspired other companies to get in the game."