Happy anniversary to Consumerism Commentary! Nine years ago today, I published the first article on this website, introducing myself and sharing the original purpose of Consumerism Commentary. The character of the site has changed drastically over this extended period of time, but I’m glad to say I’m still involved with its operation. Thanks for everyone’s concern over the past couple of weeks; my disappearance wasn’t due to any type of family emergency. I had some business to take care of that kept me away from writing.
Several years ago, the company I worked for offered — and most likely still offers — a benefit I find valuable: a free education. Included in the benefits package was reimbursement for certain tuition expenses. The company would pay ninety percent of all costs of obtaining a bachelor’s degree in any field as well as the same percentage of expenses for earning a master’s degree related to the employee’s field. Job-related certifications were also covered by the employer. There were some caveats for receiving the reimbursement, but there weren’t many hoops to jump through.
I took advantage of this benefit by pursuing a master’s degree in business administration. I value continual education in my life, and I saw a chance to earn a degree — one that might help me learn about a field that could help me in my day job as well as in what was becoming a profitable side-job — at a greatly reduced cost, I took the opportunity.
Not every company should offer this benefit, though, particularly not with strings attached. I’ve discovered that other employers do attach strings. Some companies offer reimbursement for education, but require a high GPA in order to receive the full benefit. My company required just a “C” grade average in order to receive full reimbursement when I took classes towards my MBA; now the company offers reimbursement on a sliding scale, offering the full benefit only to those with an “A” grade average. While my company didn’t have this policy, some require employees to remain employed with that particular company for a certain amount of years after completing the course in order to avoid paying back the reimbursement. Five years is a typical restricted period.
The concern among employers is that talented employees will use the company’s resources to earn a degree and quickly leave for a better job — or a better company. When the employer agrees to pay for its employees’ education, it is making an investment in those employees. The degree should help the employee “perform better” in some capacity. In many cases, that would mean either driving more revenue or reducing more expenses. If, however, the employee earns a degree and leaves, the company won’t be the beneficiary of that investment. Companies don’t cover employees’ costs for education out of their belief in the value of lifelong learning, it’s a calculated investment designed to have a financial benefit to the company and its owners.
This shouldn’t be a concern. Good companies attract good employees, regardless of the definition of “good.” If the company provides opportunities for employees at all levels, a worker with a fresh degree doesn’t have to look outside in order to take advantage of new skills or qualifications. Only the companies without confidence in its own ability to attract qualified employees need to handcuff its employees who seek additional education — generally a more ambitious group than average — to the company for several years.
It wouldn’t make sense for a pharmaceutical company to reimburse an employee pursuing a master’s degree in stage management. A degree in chemistry would be more appropriately tied to that particular job. Depending on the role, however, the employee can argue that an advanced degree in a field drastically different than the core business can be used to improve job performance. For example, a salesperson or someone in a marketing role can benefit from studying psychology at the bachelor’s degree level, if his or her educational focus is on understanding what drives people to make decisions as a consumer. It’s a stretch, but it’s possible. Pursuing a master’s degree or doctorate in psychology may only make sense for someone wishing to pursue a career in psychology or a related field, so that argument for reimbursement of an advanced degree would be more difficult for the employee to make. It may indicate to the company that a career change is imminent.
During a recession, tuition reimbursement is often one of the first benefits to be cut and one of the last to be reinstated when the company’s fiscal health has improved. many companies that did not eliminate their reimbursement benefits established new limits. A typical reimbursement cap of $2,500 would have hardly paid for my relatively expensive Master of Business Administration degree. It would have hardly made a dent for a co-worker who also pursued his MBA — but at the more expensive Columbia University.
The overall value of business degrees, graduate degrees in general, and even any college education, is constantly being called into question by the media, particularly financial media. The marketplace of employees may be saturated with MBA degrees looking for work, a graduate degree in some fields never recovers its cost through increased salaries, and the bachelor’s degree is so widespread that its attainment is almost meaningless other than being a base requirement for any job. As these questions continue, companies will be more likely to question the value of tuition reimbursement.
Does your company offer tuition reimbursement? Have you ever taken advantage of the benefit? Would you leave your company after achieving your desired education goal in search of better opportunities?