Starbucks Paying for Employees Tuition at ASU Online

This is a big deal:

Starbucks will provide a free online college education to thousands of its workers, without requiring that they remain with the company, through an unusual arrangement with Arizona State University, the company and the university will announce on Monday.

The program is open to any of the company’s 135,000 United States employees, provided they work at least 20 hours a week and have the grades and test scores to gain admission to Arizona State. For a barista with at least two years of college credit, the company will pay full tuition; for those with fewer credits it will pay part of the cost, but even for many of them, courses will be free, with government and university aid.

Over the past few decades, America has slowly but surely been transitioning from a system in which college education was treated as a public good (and therefore subsidized by taxpayers) to being a private good (and therefore paid for entirely by students and their families). And while there is no substitute for that model, it is interesting and important that Starbucks is positioning college tuition the way companies position health insurance plans—as a benefit they use to compete for better workers.

This is not an entirely new idea. Many companies have tuition reimbursement, although it often comes with more restrictions and is typically aimed at white-collar workers. A while back, Wal-Mart made headlines by offering heavily subsidized (but not free) college credit in partnership with APU. Starbucks takes this to the next level. Since both Wal-Mart and Starbucks have reputations as union busters, it will be interesting to see how their respective college subsidization moves impact their struggles with their labor forces. Will tuition help them lower demand for unionization? Will it become another bargaining chip at the negotiating table?

I wrote a while back about the idea of reviving the apprenticeship for the digital age and gave an example of an Indian tech company that is doing it. I think we’re going to see a lot more of variations on the theme of employer-funded education in the future.

You can learn more about the Starbucks college program at their website.

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About Michael Feldstein

Michael Feldstein is co-Publisher of e-Literate, co-Producer of e-Literate TV, and Partner in MindWires Consulting. For more information, see his profile page.
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