By IRINA IVANOVA MONEYWATCH
June 13, 2018, 5:30 AM
Discover is boosting the financial assistance it offers to call-center workers who want a college degree, becoming the latest company to enhance education benefits for employees.
The financial services company will pay for a bachelor's degree in one of seven programs for its workers, it announced Tuesday. That aid, which covers all costs for the degree, will be available from a person's first day on the job, Discover said.
About 70 percent of the company's 7,000-plus call-center workers lack a four-year college degree, said Jon Kaplan, vice president of training and development at Discover. (The company has about 16,000 workers in all.)
It's the latest sign of companies sweetening their perks to retain workers in an increasingly competitive labor market. Walmart, the nation's biggest private employer, announced last month that it was making heavily subsidized college degrees available to all its workers. In March, Lowe's said it would contribute up to $2,500 for its employees to get educated in the skilled trades. And Lyft started offering education discounts to its drivers in December.
"Especially with the student debt crisis, people feel like they can't embark on an education on their own," said Rachel Carlson, CEO at Guild Education, which is partnering with Discover to manage the education benefits. "Coupled with the tight job market, it suddenly becomes a very obvious benefit for employers to offer."
Discover's announcement marks the first time a financial services company has offered this benefit to lower-level workers, said Carlson. "Plenty will pay for their New York corporate employees to get their MBA, but not many will do that for their frontline workers," she said.
Workers can choose from the University of Florida (via UF Online), Wilmington University or Brandman University for their degrees. Covered programs include computer science, cybersecurity and organizational management, as well as four different business tracks.
Tuition assistance ranks high among the benefits workers desire. It outranks parental leave and child-care assistance, according to a recent Harvard Business School study.
For companies looking to improve employee compensation, tuition assistance presents a cheaper option than raising people's pay. Under the tax code, businesses can deduct $5,250 a year in education costs, a benefit that's also tax-free to the worker.
For Discover, the main benefit is better employee retention, given that turnover of workers is one of the biggest costs businesses face.
"We found that every dollar that Discover spent on tuition reimbursement repaid itself and added another $1.44 to the bottom line," Kaplan said.
He added, "The intent is to be accessible to the most number of people possible."***** ***** ***** ***** *****