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Walmart Offers College Subsidy So U.S. Workers Pay $1 a Day

Updated on
  • Retailer will also subsidize books and help with applications
  • Workers need to contribute the equivalent of $1 a day

Walmart Offers Employees College Tuition

Walmart Inc. will fund college degrees for its U.S. workforce, the latest benefit rolled out by the nation’s largest private employer to reduce turnover and counter criticism over its treatment of staff.

The retailer’s 1.5 million employees can now pursue associate’s or bachelor’s degrees in business or supply-chain management at three nonprofit schools for $1 a day, according to a statement Wednesday. Walmart will subsidize tuition, books and fees and provide support with the application and enrollment processes. As many as 68,000 employees might sign up, Walmart executives estimated.

“Many of our associates don’t have the opportunity to complete a degree,” said Drew Holler, Walmart’s U.S. vice president of people innovation, in an interview. “We felt strongly that this is something that would improve their lives and help us run a better business.”

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Walmart declined to disclose potential costs. According to Guild Education, a company that helps large employers extend education benefits, programs such as this cost companies from $6,000 to $10,000 per worker annually. Guild Education is working with Walmart to provide academic counseling as part of the plan.

The tuition program -- offered to part-time staff as well as full-timers -- is the latest move by Walmart to improve employee retention and engagement. Earlier this year, the company boosted its starting hourly wage to $11, expanded its maternity and parental leave policy and added an adoption benefit. The newest offer comes three years after Starbucks Corp. said it would pay full tuition for its workers, rather than just partially foot the bill.

Three Schools

The Walmart and Sam’s Club employees can choose from three schools that focus on adult learning: the University of Florida, California’s Brandman University or Bellevue University in Nebraska. Courses can be taken at the campuses or online, Walmart said, and there is no penalty for courses already taken if an employee leaves the company while enrolled in school. There’s also no requirement to continue working at Walmart for any period after receiving the degree.

Walmart estimates that as many as 5 percent of its U.S. workforce could take advantage of the college program. The company currently offers subsidized programs to help employees get their high-school diploma.

Work/School Juggle

OUR Walmart, an activist group, called the plan a “step forward” in a statement, but questioned how many employees would be able take advantage of it because of the company’s scheduling system, which might make it difficult to juggle work and college.

“As soon as you tell Walmart you’re going to school, you lose access to a full-time schedule,” Andrea Dehlendorf, co-executive director of OUR Walmart, said in an interview after the company’s shareholder meeting Wednesday.

Walmart executives said they picked the three schools partly because they have the most options available in terms of flexible class times.

Starbucks said it hopes to have 25,000 employees graduate from Arizona State University by 2025 as part of its free four-year college tuition program. Chairman Howard Schultz said last year that Starbucks was the first American company to offer free four-year tuition for all its employees.

(Adds estimate of program cost in fourth paragraph, and comment from activist group member in ninth paragraph.)
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