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Starbucks Commits $250 Million to Employee Tuition

Thousands of workers are expected to pursue degrees online, all four years free.
Katie Kuehner-HebertApril 7, 2015
Starbucks Commits $250 Million to Employee Tuition

Starbucks and Arizona State University are expanding their joint scholarship effort to give eligible Starbucks employees a full ride to the college’s online degree program.

Starbucks logoThe parties announced in a joint press release Monday that the Starbucks College Achievement Plan, introduced in June 2014, will now offer 100% tuition coverage for U.S. employees of Starbucks. Full tuition coverage was previously available to juniors and seniors, but now all eligible employees can apply for and complete all four years of a bachelor’s degree through ASU’s online degree program. Starbucks also said it would reimburse its portion of the scholarship at the end of each semester rather than the end of the school year.

“Everyone deserves a chance at the American dream,” Starbucks chairman and chief executive Howard Schultz said in the release. “The unfortunate reality is that too many Americans can no longer afford a college degree, particularly disadvantaged young people, and others are saddled with burdensome education debt. By giving our partners access to four years of full tuition coverage, we will provide them a critical tool for lifelong opportunity. We’re stronger as a nation when everyone is afforded a pathway to success.”

asu-logoNearly 2,000 Starbucks employees have already enrolled in the program, which offers 49 undergraduate online degrees. The company said it would invest up to $250 million, possibly even more, to help at least 25,000 employees graduate by 2025. Moreover, over the next three years Starbucks plans to hire 10,000 “Opportunity Youth, from the population of nearly six million “disconnected” people between the ages of 16 and 24 who are not working or in school.

A CNN Money article Monday provided some additional details:

  • ASU covers 42% of the cost for each credit of course work, and Starbucks pays the remaining 58%, minus any other scholarships the employee receives.
  • Graduates of the program do not have to remain employed by Starbucks.
  • Employees who already have a four-year degree cannot apply.
  • Employees at Starbucks’ “licensed stores,” such as those located inside grocery stores, cannot apply.

Forbes contributor Micah Solomon, a consultant on corporate culture and customer service, Monday outlined why other companies should consider launching similar programs. It can enhance corporate culture and employee morale, he wrote, which can increase their “brand ambassadorship” after leaving the company. Happier employees can also attract and retain more customers.

“A customer-facing organization like Starbucks has to be on its feet and nice to customers all day long,” Solomon wrote. “Not just kind of nice, really nice. And that kind of nice comes off as a lot more genuine if the employees providing it aren’t just ‘on stage.’ If the company is being nice to them, if they’re being nice to each other, and if being nice to customers is simply an extension of what’s going on, not just an act.”

Images: Starbucks logo: Marc van der Chijs, CC BY-ND 2.0; the image is unchanged from the original. Arizona State logo:  Matthew Shearon, Desert Online Systems