Workforce Development Strategies at Lumina Foundation

What if employers stopped hunting for unicorns and started developing the employees they already have? And what if higher education institutions could help them do that in a way employers would respond to positively? 

Haley Glover, Strategy Director at Lumina Foundation, joined the Enrollment Growth University  podcast to talk about how higher education can be a better partner with leading employers on workforce development strategies.

Employee Education Trends for Workforce Development

Emerging evidence indicates that employee education benefits are powerful tools to retain talent, help them transition up and across the organization, and help them achieve more in terms of their careers and wages.

Plus, it’s revealed a lot of people currently working in the entry levels of an organization are capable of doing work at higher levels if they’re provided with the skills and training.

“It’s about transitioning away from finding unicorns…into looking at your incumbent workforce as an opportunity to grow your business in a really sustainable and high impact way,” Haley said.

Why Employers Should Encourage Their Workforce Use Education Benefits

About 2-5 percent of eligible employees utilize their employee education programs, but strong anecdotal evidence suggests that employers will simultaneously moan about low utilization rates without ever doing anything other than put out the program description. Utilization rates are low because nobody knows about the programs. 

“We’re really encouraging employers,” Haley said, “if you want this to grow, you have to do some pretty intentional work to make it grow. And we encourage companies to get on their data to really understand what’s driving better outcomes.”

Haley herself did an ROI analysis of five programs. In every case, she found that employee education programs held powerful retention ability. Participating workers stuck around at the company a lot more than their non-participating peers, and they were promoted at much higher rates. 

“All of these things,” Haley said, “are cost-saving outcomes and factors for the company.” 

She also found that employees who participated in these programs experienced significant wage gains. In one case, a financial services company had marginal wage gains about 50% higher than those who did not participate. 

“So from the employee perspective,” Haley said, “they should really consider participating in these programs too, because they’re something that the employer values. And money talks.”

Improving Basic Structural Elements Behind Education Benefits

The question about tuition assistance versus tuition reimbursement is a critical one because it hits right in the middle of where the employee pain point might be. Typically a company will cap the education benefit at $5,250 annually, which is the limit within the IRS tax code that an employee can receive without a tax implication.

But telling an employee to write a $5,000 check, even as a short-term float, is simply unrealistic for a large portion of the market. In the past, companies said, “The risk is all on you. Go ahead, make this bet. We’ll pay you back if you get a passing grade in the course and if you are still around.” In the meantime, the employee has to scramble to find those funds in the short-term until they’re reimbursed.

Today, companies are starting to recognize this problem and are making the decision to offer the resources directly to the college as part of a tuition assistance program so employees don’t have to figure out how to short-term front those large sums. Also, more employers have eliminated the claw back in which employees pay back money if they can’t finish or earn a low grade. More companies now are recognizing that folks’ lives shift pretty dramatically, even in short periods of time. So more employers are moving toward tuition assistance vs. reimbursement.

Next-Steps Advice for Employer-University Partnerships

“In the past, I don’t think employers looked too hard at their education partners, because they weren’t particularly using the education benefit program as a strategic investment,” Haley said. “There is a shifting trend from employers saying go anywhere, study anything, to employers saying, we want you to study particular fields that are highly relevant for our strategic workforce needs.”

“I do think more employers are becoming aware of the incredible differences between and among our colleges and universities in this country and a lot of them are paying more attention to the outcomes. How are institutions doing in terms of supporting adult learners, supporting those who have to attend part time, supporting those who are working and learning simultaneously, supporting those who have children and families and full lives? And so those companies that are pivoting toward looking at outcomes of the institution, I think, are making wise decisions with their investments.”


* Lumina Foundation Employer ROI Studies

* Lumina Foundation Tuition Assistance Considerations

This post is based on a podcast interview with Haley Glover from Lumina Foundation for Education. To hear this episode, and many more like it, you can subscribe to Enrollment Growth University.

If you don’t use iTunes, you can listen to every episode here.