Like an extra shot of espresso in a cup of coffee, the announcement this week that Starbucks will spend millions of dollars to help its employees take online college courses at low cost or for free sent a jolt through the world of higher education.
The Starbucks College Achievement Plan, as it’s called, will provide partial scholarships for qualified employees who are freshmen and sophomores and full tuition reimbursement for those who are juniors and seniors. The idea is to give baristas and other employees a financial incentive to finish a college degree.
There’s a key condition: Participants will have to take classes online through Arizona State University. Your barista, then, might become a Sun Devil.
Howard Schultz, chairman and chief executive of the Seattle-based company, said Wednesday in an interview with The Washington Post that he expects thousands of full- and part-time employees to take advantage of the benefit in the coming school year — perhaps as many as 10,000. The cost to Starbucks is difficult to project, but Schultz said it is “very possible” that the company’s share of the education cost could amount to $50 million a year.
Under federal law, Starbucks can provide employees up to $5,250 a year for tuition reimbursement as a tax-free benefit. Students will be expected to obtain need-based financial aid from the federal government, if they qualify. Arizona State will provide grants as well.
Notably, Starbucks is not requiring employees to stay with the company after they earn a degree. “We’re investing in our people,” Schultz said, “and we should not put handcuffs on them.”
There is no shortage of colleges with online programs these days. Schultz said Starbucks considered teaming with several universities, including some run for profit, before settling on Arizona State. “We needed a like-minded university and a like-minded leader,” he said, referring to Michael M. Crow, president of the university. Schultz said the company wanted only one partner at first because of the complexity of the initiative.
Arizona State is one of the nation’s largest universities and has grown rapidly in recent years. Crow said it has about 65,000 students enrolled in programs at the main campus in Tempe and others in the Phoenix area. Another 10,000, he said, are enrolled in online programs that began three years ago. The university has 40 online undergraduate degree programs, in subjects ranging from art history to electrical engineering.
The Starbucks initiative could help double the university’s online footprint. Crow, who is one of the nation’s more ambitious university leaders, said Arizona State’s online operation is of a scale comparable to those of Penn State University and the University of Maryland University College.
Crow said he was pleased to collaborate with Starbucks on a program that aims to deliver “a first-class college education.” Arizona State, he said, “has the vision, programs and scale to deliver it to Starbucks employees in every part of the country.”