Starbucks, Magna Cum Grande

Its plan to help employees pay for college is laudable but not perfect
Illustration by Bloomberg View

College degrees often have fancy names, take a long time to get, and cost more than they should. In other words, they’re already a lot like Starbucks coffee. So maybe it’s not surprising that the Seattle-based coffee chain says it plans to start helping employees pay for college. It’s a welcome development from both an educational and employment standpoint, even if Starbucks’s claims for the initiative are slightly exaggerated. In corporate PR, as in college grades, a little inflation is to be expected.

For employees working at least 20 hours a week, Starbucks will pay part of the tuition for the first two years of an online bachelor’s degree from Arizona State University. The idea is that with tuition support from Starbucks, Pell Grants and other federal aid, and financial assistance set up by the university, employees will be left to cover less than half the cost of a full-time education. Starbucks says students will have the entire cost—currently about $15,000 a year—covered for their final two years.

What makes this different from other companies’ tuition-support programs is that employees don’t have to stay at Starbucks after they graduate. Nor is the benefit limited to long-serving workers; anyone can take advantage of it, regardless of how long he or she has been with the company. And there are about 40 degree programs at ASU to choose from.

This isn’t necessarily altruism on the part of Starbucks—nor should it be seen as such. First, federal student aid is what makes it possible. Second, Howard Schultz, the company’s chairman and chief executive officer, predicts the policy will allow Starbucks to attract and retain better employees, while enhancing the company’s reputation.

Starbucks’s approach may provide lessons for other companies and for institutions of higher learning. That includes examining what incentives best encourage part-time workers to pursue a degree and whether increasing financial support in the third and fourth years of college can help improve completion rates. If Starbucks can show that such programs enhance productivity, other companies may follow suit.

That said, it’s worthwhile to note just how limited this program is. It applies only to online courses from Arizona State. Some Starbucks workers may prefer to pursue a degree in person at a local college or community college, or online elsewhere. Those programs don’t qualify.

All else being equal, many options are better than one—but one is better than none. By offering this program, Starbucks is making college more accessible for its employees. They may find the extra shot is worth it.

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