Breaking Barriers to Higher Education: How Employers Can (and Should) Help
An increasing number of employers are providing education assistance to their employees. Companies like Dutch Bros Coffee, McDonald's, Bright Horizons, and many others are offering to pay up to 100% of college tuition for their full- and part-time workers, allowing them to earn degrees, certificates, and trade skills without incurring one penny in student loan debt.
Why are employers investing millions in their employees’ education? It's about increasing opportunities and financial advancement for employees, boosting retention and loyalty (and employer brand) in the process, and helping combat the student debt monolith that’s looming large over our economy.
A path forward through free-of-charge education
We’re facing an education crisis in this country. As many students graduate from high school, they aren’t seeing a path toward the brighter future and financial well-being higher education can provide. One reason for this is the incredibly high cost of that education. Student loan debt is such a burden for so many it's actually dragging down our economy. And many people, especially in minority populations, just simply don't have any means to access the funds necessary to get an education, let alone pay back student loan debt.
Here are a few quick facts about the costs of higher education:
- For the 2020-21 academic year, the average cost for in-state students at a state school was $22,180, according to College Board, which tracks college pricing.
- In the last decade, student loan debt increased by an average of $91 billion every year, according to EducationData.org.
- Since 2006, student loan debt has increased by 248.19%.
The high cost of education and student debt affects minority populations disproportionally. According to the Bureau of Labor Statistics, Black Americans have a 50% higher unemployment rate than all Americans, and 74% of Black Americans do not have a four-year degree. Yet, our own research, "Workforce Education and Equity in the Workplace," shows that 87% and 81% of Black workers say completing a certificate or a degree, respectively, will be important for future success.
That's one of the reasons that Bright Horizons joined the OneTen initiative, a coalition committed to upskilling, hiring, and promoting one million Black Americans over the next 10 years into family-sustaining jobs.
Why education assistance benefits employers
Employer-sponsored education for frontline employees provides a pathway toward a better life and financial security. Many people, especially in disadvantaged minority populations, simply do not have the option to earn a degree and use it to their advantage when looking for a job. Instead, it's the other way around — they need to get a job first. But without a degree, the available jobs are generally entry-level, and with no access to higher education, it can cause employees to feel like they’re stuck in a so-called "dead-end job." They lack opportunities to improve their financial situations and better their lives.
The benefits for employers are equally as profound. Our "Workforce Education and Equity in the Workplace" report revealed that while many workers see learning as the pathway to personal betterment, they also see it as a way to improve their performance on the job, thus benefiting their organizations.
Among those employees who have already begun or finished an education program in the past five years:
- 42% wanted to improve their job performance
- 33% were driven by a desire to contribute at a higher level
- 31% wanted to bring more value to their organizations
- 41% were motivated by the prospect of earning a pay raise
- 40% wanted to strengthen their job security
Employers who provide education assistance to their employees enjoy other benefits, as well. They find their education assistance programs:
Boost recruitment efforts. In this tough hiring market, education assistance is a game changer. When given the choice between two companies — one that provides this benefit and one that doesn't — that choice is clear.
Increase engagement and loyalty. Giving workers a leg up and showing you care about their futures — whether they work for you in the end or not — creates a greater sense of engagement and loyalty.
Reduce turnover. The high cost of turnover is a burden to employers, especially in industries like hospitality. Providing opportunities for your employees to continue their education doesn’t guarantee they’ll stay with you for their entire careers, or even after their education is complete, but it will turn them into cheerleaders for your organization.
Are good for your brand. The expression, "Do well by doing good," applies here. Your brand — not the products you make or the experiences you provide, but what kind of company you are — is increasingly important, especially with younger consumers. They want to know that the companies they patronize are good corporate citizens with values similar to their own. Providing education assistance is a powerful way to walk your talk and show your values to the world.
How Bright Horizons can help
Bright Horizons EdAssist Solutions® provides education benefits that drive powerful recruitment, retention, and talent development results. We offer a two-pronged approach: Workforce Education, which includes education assistance benefits for your employees, and Student Loan Support, which helps your people pay off the student debt they've already incurred.
Both will boost loyalty, help build the skills of your workforce, give you a rich pipeline of people to promote from within, and help your employees reach a greater level of financial security and career advancement.
For more information, read Bright Horizons' Working Learner Index, the nation's largest study of tuition assistance participants. Ready to get started? Please contact us today.
October 12, 2021