Economy Rife for Education Benefits

Companies in high-turnover industries are looking to education-assistance programs to improve recruitment and retention.
By: | March 23, 2018 • 2 min read

Taco Bell recently announced it is expanding its education-assistance program, part of a move to attract and retain workers in an economy where lateral moves are becoming increasingly common.

The fast-casual restaurant launched a pilot program last year at 700 of its corporate-owned locations in partnership with Guild Education, which connects 2-million Americans with education benefits.

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Taco Bell employees were given access to more than 2,000 courses at 80 online universities to pursue undergraduate, graduate, GED and English as a second language programs. Guild provided tuition discounts and Taco Bell covered up to $5,250 in tuition assistance—which it paid upfront to eliminate any out-of-pocket costs. Enrollees were connected to Guild Education advisers, as well as offered financial-aid resources and the ability to earn on-the-job college credits.

The investment paid off, according to the company—those enrolled in the pilot program were 34-percent more likely than other workers to stay on the job. Now, Taco Bell is expanding the initiative throughout the company, to 210,000 workers, including those at franchise locations.

Rachel Carlson, founder and CEO of Guild Education, says Taco Bell’s retention boost was similar to the outcomes at other partner companies, such as at Chipotle, where retention jumped 40 percentage points in the first nine months of the program.

“Every client we’ve worked with has seen a meaningful retention impact,” Carlson says.

In 2015, Society for Human Resource Management found that about 56 percent of American employers offered undergrad-assistance programs, a number that it predicted would see an upswing.

The current economy, Carlson says, makes such programs a sensible fit for both employers and employees, especially in the restaurant industry. During the recession, companies weren’t struggling with front-line retention but, now with a stabilized economy and low unemployment rate, many more fast-casual restaurant workers are jumping from job to job, perhaps for a pay difference of just $1 per hour.

“Lateral moves are happening at a pervasive rate,” Carlson says. “That isn’t great for our economy—we want to see people moving up—but it also isn’t good for the business or for the employee. So if there’s a resonating benefit to stay in the job, those are the people who are being more thoughtful about doing so.”

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Recruitment also gets a shot in the arm, as workers are more likely to pursue a job where enhanced educational opportunities can mean they can move up from a front-line position to management, Carlson adds. Guild Education has found that employees who enroll in a degree or certificate program are 2.5 times more likely than their peers to progress within the company and earn a promotion.

That “positive turnover” contributes to the company’s bottom line, Carlson says. The company claims its clients have seen a return on investment between 120 percent and 210 percent from their education-assistance programs.

As HR has historically been viewed as a “cost center,” she adds, such programs offer a unique opportunity for HR leaders “to run a program that creates value for the business and also drives positive ROI.”

Jennifer Colletta is managing editor at HRE. She earned bachelor's and master's degrees in writing from La Salle University in Philadelphia and spent 10 years as a newspaper reporter and editor before joining HRE. She can be reached at [email protected]

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