Things to Consider When Developing a Tuition Aid Effort
A strategic approach to tuition assistance can help to mitigate the skills shortage by filling gaps and creating talent mobility.
Prolonged downward economic pressures, combined with a need for skilled workers, has forced many to re-examine tuition assistance and justify its expense.
Just three years ago, tuition assistance plans were offered at 87 percent of employers across the country, according to Bersin by Deloitte, a research firm. Today, Bersin's research finds that number has shrunk to 71 percent, as many companies have opted to eliminate or suspend their tuition assistance.
A strategic approach to tuition assistance, however, can help to mitigate the skills shortage by filling gaps, creating talent mobility, forwarding career development and improving a company's overall talent pool.
First, companies need to align tuition assistance plans with overall talent management goals and leverage them to support learning objectives. If this is not done, the money spent is virtually unmanaged and often wasted.
With the average amount spent per employee increasing to nearly $5,000 in 2012, this can quickly add up. It is estimated that close to $16.5 billion annually is spent on tuition assistance plans in the U.S., according to a 2009 study by Bersin.
By examining past tuition assistance spending and by identifying gaps in workplace talent companies can gain a better understanding of where they need to allocate future tuition assistance dollars.
A hospital seeking "magnet" status might have a need to increase the number of nurses holding bachelor's of science in nursing (BSN) degrees. To achieve magnet status, a hospital must ensure that 80 percent of its nurses hold BSNs by 2020.
For example, a magnet status-seeking hospital could choose to promote its tuition assistance program to its nursing teams. On a strategic level, the hospital could decide to allocate more tuition assistance dollars for full-time nurses and less for other staff members, where the skills gap is not so marked.
Additionally, the hospital could reach out to a local university or online higher education institution and jointly develop an academic program specific to the hospital's needs. This specialized program could be wholly or partly reimbursed by the organization's tuition assistance program, making it both attractive and accessible for nurses. The partnership could even result in cost savings from discounts on fees to credits given for work experience.
Companies need to view their role in tuition assistance as extending beyond the administrative aspects of educational reimbursement. According to Bersin's 2012 study, roughly 30 to 40 percent of employers provide advisory and resource programs to help their employees make better choices for education and development, and to enable them to make better use of their tuition assistance benefit.
Lastly, companies should consider whether they want to use their tuition assistance plan to pay for the prior education of their employees through a loan repayment assistance program. The burden of mounting student loan debt can have a very real impact on the well-being of employees, contributing to increased absenteeism, lower productivity, decreased morale and higher turnover.