Tuition-assistance benefits pay for themselves
September 16, 2009 by Christian SchappelPosted in: In this week's e-newsletter - benefits, Latest News & Views, Pay and benefits
Benefits pros have long questioned the value of providing tuition-assistance.
After all, won’t employees’ new degrees just make them more likely to leave for greener salary pastures?
Turns out, the opposite is true.
A landmark study recently published by the National Bureau of Economic Research finds:
- among employees participating in these benefit plans, only 33% leave the employer within five years
- these employees typically rate job satisfaction as a bigger priority than salary, and
- the jump in long-term productivity usually makes the investment in the employee’s education pay for itself.
By comparison, eligible employees who don’t participate in education benefits are nearly twice as likely to leave within five years (60%).
The study also found that big employers — those with 1,000 or more employees — remain more likely than small companies to offer some form of educational assistance.
On the flip side, the dollar-for-dollar return on investment is often better for smaller employers.
Tags: benefits, education, educational assistance, National Bureau of Economic Research, return on investment, tuition-assistance
September 18th, 2009 at 7:38 am
I find the opposite to be true because most in smaller companies, the positions that these employees have gone to get higher education for are not usually open. They might wait around until they fulfill their contractual obligation for Tuition assistance but once that is up and nothing has opened up for them, nor has the employer given them an increase based on acquiring a degree or higher degree, they will leave.
September 18th, 2009 at 10:15 am
I agree with Stacy, but also found it to be true in large organizations as well. Once I completed my law degree and passed the Bar I continued in my same low level administrative assistant role for many years. Never got a pay increase except the usual one or two percent per year.
September 24th, 2009 at 2:26 pm
I don’t think this article was targeted at employees who are employed full time in low level positions while working toward a law degree. Not to be rude – but I would have to ask why someone with a law degree, who had passed the bar exam, would continue to work in a “low level administrative assistant role for many years”.
September 24th, 2009 at 4:18 pm
We are in Healthcare. This is only true for our patience care employees. Our non-patient care employees leave once they’ve completed their schooling simply because there are little to no positions available (besides the entry level) and they do not receive more pay other than their annual merit increase (2-4%). However, the value added on our patient care side greatly out weighs the admin staff. It is still a good beenfit for the hospital.