Leveraging Tuition Assistance Programs by Increasing the Type of Programs Covered
The type of programs covered by corporate tuition assistance policies varies widely from company to company. Historically, tuition assistance programs have covered only master's and bachelor's degrees. Doing so has allowed employers to attract better talent and retain top employees. This approach was purely looked at as another employee benefit, not as a way to reach company strategic talent goals.
Employers are Trending Toward Supporting Certificate ProgramsIn a labor market that is becoming more highly specialized and with more jobs requiring technical expertise, it is becoming increasingly common for a tuition assistance program to cover professional certification programs.
I saw recent data showing that only 32% of college graduates have "excellent" skills to enter the workforce, only 16% of high school graduates have such skills and are missing critical thinking and problem solving skills, and only 18% of the workforce training programs raise skills from "deficient" to "adequate." As a result, certificate programs have become more popular, serving both employer and employee.
Based on our policy database that includes more than 100 policies from Fortune 500 Companies, we see more than 50% of companies offering coverage of certificate programs within their tuition assistance strategies.
Three Major Factors Contributing to the TrendThis trend is happening for three reasons:
- Certificate programs offer a way to either advance skills or a career
- It takes less time to complete a certificate versus a degree
- Certificate programs cost less
A certificate, of course, is not equivalent to a degree, and employers may still prefer an associate's, bachelor's, or graduate degree. But certificate programs are excellent options for people who want to take a first step toward a degree or learn specific skills to further their careers, while balancing jobs, families, and other demands of life. The trend towards supporting certificate programs is indicative of the fact that companies are aligning their tuition assistance strategies with the strategic needs of the labor force and they want to stretch the dollars spent further.
Company policies are also expanding to cover "Credit by Examination." These programs allow employees to earn college credit by taking a specialized exam. Again, similar to certifications, employees can earn their degrees more quickly - which reduces the out of pocket cost to the company and employee.
Maximizing Return on a Major InvestmentAs I indicated in my last blog, companies are becoming much more strategic with their tuition assistance programs. These programs are not merely an employee entitlement, but they are another way companies can meet their strategic objectives. This makes complete sense - especially since US companies spend over $16.5 billion per year on these programs.
August 1, 2020