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Walmart says it will pay for its workers to earn college degrees

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Walmart will begin offering to subsidize college tuition for its 1.4 million US workers, joining a growing list of companies that are helping employees pay for higher education as a perk in a tight labor market.

[NEW YORK] Walmart will begin offering to subsidize college tuition for its 1.4 million US workers, joining a growing list of companies that are helping employees pay for higher education as a perk in a tight labor market.

The giant retailer said it would pay tuition for its workers to enroll in college courses, online or on campus, to earn degrees in either supply chain management or business.

Full- and part-time Walmart workers can use the subsidy to take courses at the University of Florida; Brandman University in Irvine, California; and Bellevue University in Bellevue, Nebraska.

The three universities were chosen because of their high graduation rates, particularly among part-time students, and their experience with those already in the workforce, Walmart executives said. Walmart employees will not be obligated to continue working for the company after they get their degrees and must put up only US$1 a day toward the cost of classes.

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"We feel like this is another step forward in investing in our associates," said Julie Murphy, an executive vice president in Walmart's US operation.

Walmart was expected to announce the tuition subsidy to the thousands of workers who gathered for the company's annual shareholder meeting in Bentonville, Arkansas, on Wednesday.

Walmart, the country's largest employer, is introducing the tuition subsidy as it seeks ways to retain workers at a time of low unemployment. Employers like Starbucks and Amazon also offer tuition support.

Walmart, which has faced criticism over low pay and poor working conditions, is also trying to burnish its image while trying to expand its presence in more upscale markets online.

Earlier this year, Walmart raised its base wage US$2, to US$11 an hour, and expanded its maternity and family leave benefits. The company has also begun offering lower-level store managers more job training programs called "Walmart Academies," where employees learn basic management skills and graduate in ceremonies wearing caps and gowns.

Activists groups - including Organization United for Respect Walmart, which will be staging demonstrations in Bentonville this week - argue that the company should raise hourly wages to at least US$15, a figure that Walmart's rival Target has committed to.

Walmart officials did not provide an estimated cost for the tuition subsidy, but they expected that about 68,000 employees would probably enroll during the first five years, based on those who have expressed interest and an analysis of similar programs in other industries.

The University of Florida is probably the best known of the universities in the Walmart program. Brandman University, which has multiple campuses in California and an online curriculum, has a focus on Hispanic students. Billionaire investor Joe Ricketts, who founded TD Ameritrade, is among Bellevue University's benefactors.

Walmart said its goal was to help employees obtain a college degree without having to take out loans. Walmart workers enrolled in the program will not be required to pay for their education up front and seek reimbursement later. When Starbucks first announced its tuition subsidy and a partnership with Arizona State University in 2014, the company was criticized for pushing the risk on its workers by making them pay up front.

Walmart workers will qualify for the benefit after 90 days of employment and will not be penalized if they leave the company before finishing their studies.

The tuition subsidy will only apply to associate's and bachelor's degrees in two programs that are somewhat related to retail work, but the areas of study could be expanded to other areas in the future, Walmart officials said.

NYTimes