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Will Starbucks' Free Tuition Perk Catch on with Other Employers?

June 16, 2014, 8:00 AM

What's the Latest?

Baristas rejoice! News broke yesterday that Starbucks would offer free education to thousands of its employees through a new partnership with Arizona State University. The program covers full tuition for company employees with at least 2 years of college credit and will allow them to pursue a degree through ASU's online education service. Starbucks chief executive Howard D. Schultz is expected to expound on the announcement at an event this afternoon in New York with U.S. Secretary of Education Arne Duncan and Arizona State president Michael M. Crow.

What's the Big Idea?

While the new program no doubt benefits thousands of Starbucks employees who yearn for the opportunity to earn a Bachelor's Degree, offering tuition to employees could lead to good things for the company as well. First, the attractive perk will no doubt lure higher quality employees motivated by ambition to apply for jobs. Not enough companies invest in strengthening their workforce on the lower levels. Starbucks could be a major trendsetter in this regard.

An additional benefit for the company comes in the strengthening of the Starbucks brand. While altruism isn't much of a fiscal policy, it certainly is sexy. Howard Schultz said as much to The Times: 

"[Employees' experiences] would be accredited to our brand, our reputation and our business.”

What's left to be decided is if other companies will follow Starbucks' lead. Most fast food chains and big box retailers haven't followed the coffee giants' lead in offering part-time workers stock options and health insurance. Still, if this new program ends up paying dividends -- either financial or via goodwill -- we may see a shift in the way companies invest in their workers. 

Read more at The New York Times

Photo credit: 1000 Words / Shutterstock.com


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