The strong job market outlook coupled with retailers’ focus on experiences have resulted in beefed up benefits packages with stores hoping to secure, motivate and retain top talent.
The industry saw a wave of pay hikes across sectors that was largely attributed to the newly instituted corporate tax breaks. Walmart was one of the first to announce new hourly rates along with improved parental leave. Now the retail giant is rolling out a new perk.
Speaking at the company’s annual meeting on Friday, Walmart president and CEO Doug McMillon touted the retailer’s new associate education benefit program announced this week and other strategic decisions he said are positioning the company “for success in the future.”
McMillon stressed that the company’s transformation is aimed at building new capabilities to meet evolving customer expectations and equipping its associates with tools and training to succeed in today’s workplace.
The associate education benefit is designed to remove barriers to college enrollment and graduation and is another step in the company’s commitment to train and educate workers. In partnership with Guild Education, an education benefits platform, Walmart associates will be able to access affordable, high-quality associate’s and bachelor’s degrees in Business or Supply Chain Management.
Under the program, which will be made available to all Walmart U.S. and Sam’s Club associates, Walmart will subsidize the cost of higher education beyond financial aid and an associate contribution equivalent to $1 a day. Degrees will be offered through the University of Florida, Brandman University and Bellevue University. Associates participating in the program will receive support from a Guild Education coach on areas such as application and enrollment to selecting the appropriate degree.
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Walmart will subsidize the cost of tuition, books and fees, eliminating the need for student loan debt and addressing one the biggest hurdles that keep people from returning to college, the company said. In addition, associates can earn college credit for paid training at Walmart Academies, where hundreds of thousands of associates have already undergone skills training equivalent to more than $210 million in college credits.
Walmart selected universities with a specialized focus on serving working adult learners and top outcomes for the working adult demographic. In addition, Walmart is collaborating with these universities to tailor curriculum to relevant skills for jobs and advancement across industries for today and in the future. These programs are available to full-time, part-time and salaried Walmart U.S. store, supply chain, home office and Sam’s Club associates.
Walmart noted that college degrees in supply chain management or business are parts of a broader approach to preparing the workforce to succeed today and into the future. Initiatives include developing a broad suite of offerings across roles and levels to help associates from frontline to executive levels develop job-related skills for advancement, and offering associates and eligible family members access to tuition discounts, financial aid assistance and education coaching across Guild’s broader network of more than 80 accredited, nonprofit university partners, including schools such as Georgia Tech, Columbia University and Purdue University.
Walmart’s meeting on Friday coincided with the Labor Department’s monthly jobs report that showed retail industry employment increased by 28,800 jobs seasonally adjusted in May over April and 100,200 jobs unadjusted year-over-year.
“With the unemployment rate of 3.8 percent at its lowest since April 2000, shows that many industries including retail are hiring and creating jobs at a steady pace,” National Retail Federation chief economist Jack Kleinhenz said.
In the overall economy, average hourly earnings in May increased 2.7%, or 8 cents, year-over-year. Ben Herzon, executive director of U.S. economics at Macroeconomic Advisers by IHS Markit, said, “Nearly all aspects of this report were positive and consistent with solid growth of wage-and-salary income in the second quarter. The labor market is tightening rapidly and declines in the unemployment rate are likely to continue, but at a slower pace.”
Walmart’s new benefits come at a time when retailers are recognizing the value of its stores and their employees by extension.
In January, Walmart announced plans to increase the starting wage rate for all hourly associates in the U.S. to $11, expand maternity and parental leave benefits and provide a one-time cash bonus for eligible associates of up to $1,000.
Target Corp. announced plans in March to increase starting wages to $12 starting with current employees this spring. By the end of 2020, the retailer is committed to increasing that starting amount to $15.
Macy’s recently instituted an employee incentive plan designed to motivate every Macy’s staff member to push the company’s North Star turnaround plan forward. Speaking during the company’s first quarter call with analysts, Macy’s CEO Jeff Gennette said the plan is having the desired effect. “What we found is once these front-line colleagues get that first paycheck for that quarter, that what it does to kind of reinforce great behaviors,” he said.