Starbucks to provide free college education to thousands of workers

The New York TimesJune 16, 2014 

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 Monday (June 16).

The program is open to any of the company’s 135,000 U.S. 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.

“Starbucks is going where no other major corporation has gone,” said Jamie P. Merisotis, president and chief executive of the Lumina Foundation, a group focused on education. “For many of these Starbucks employees, an online university education is the only reasonable way they’re going to get a bachelor’s degree.”

Many employers offer tuition reimbursement. But those programs usually come with limitations such as the full cost not being paid, new employees being excluded, requiring that workers stay for years afterward, or limiting reimbursement to work-related courses.

Starbucks is, in effect, inviting its workers, from the day they join the company, to study whatever they like, and then leave whenever they like. The company does this knowing that many of them, degrees in hand, will leave for better-paying jobs.

Even if they did, their experience “would be accreted to our brand, our reputation and our business,” Howard D. Schultz, the company’s chairman and chief executive, said in an interview. “I believe it will lower attrition, it’ll increase performance, it’ll attract and retain better people.”

In a low-wage service industry, Starbucks has for decades been unusual, doing things such as providing health insurance, even for part-timers, and giving its employees stock options. (Like other food and drink chains, it has also been accused of using improper hardball tactics in fighting unionization drives.) Whether in spite of those perks or because of them, the company has been highly successful; its stock, which closed Friday at $74.69, has grown in value more than 100-fold since it went public in 1992.

The president of Arizona State, Michael M. Crow, something of an evangelist for online education, was scheduled to join Schultz and Arne Duncan, U.S education secretary, to announce the program Monday in New York. Arizona State has one of the largest online degree programs in the United States, with 11,000 students and 40 undergraduate majors, and one of the most highly regarded.

The university and the company say they do not know how many Starbucks employees will take advantage of the program.

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