Enterprise Case Study: How 100% Tuition Reimbursement Future-proofs Walmart’s Business

Walmart made headlines in 2021 when it began covering 100% of college tuition and textbook costs as a day-one benefit for all of its 1.6 million US. employees. The company had previously charged associates of Walmart and Sam’s Club a dollar a day to participate in its Live Better U program and required 90 days of service prior to enrolling. The changes have been well received: Participation was more than 500% higher in 2021 than it was in 2019, according to the latest data from Walmart. Employees who participate are also more engaged in their work and are being promoted sooner than their peers, according to a 2021 study by the Lumina Foundation.

“We removed another financial barrier for our associates so that they can have access to education that they likely haven’t had in the past,” Beth Williams-Moore, Director of Live Better U at Walmart, tells Toptal Insights. The program allows employees to pursue long-held aspirations and create a better future for themselves, she says.

It also ensures a brighter future for Walmart. Investing in employee education has far-reaching benefits that can future-proof a business, such as creating a robust talent pipeline amid widespread labor shortages, raising productivity, and seeding long-lasting goodwill.

In today’s topsy-turvy labor market, corporate leaders should take note.

Done Well, Tuition Reimbursement Creates a Robust Talent Pipeline for Hard-to-fill Roles

Walmart took a precision approach to its educational partnerships, with an eye to ensuring not just the happiness of its employees but Walmart’s own continued success.

“Our education offerings tie directly to how we’re going to grow as a business,” says Williams-Moore, noting that Walmart will invest nearly $1 billion over the next five years in career training and development for workers who want to pursue majors in high-demand areas, such as business administration, software engineering, supply chain analysis, and cybersecurity. To date, business-related fields make up half of all Live Better U college degree program enrollments, with healthcare and technology fields gaining traction.

“We’ve been able to utilize the interests of our students, mixed with the growth areas of our business, and put together a portfolio that’s pretty extensive for our associates to choose from, no matter where they’re at in their educational career,” Williams-Moore says.

Walmart’s Live Better U program differs from some other major companies’ tuition reimbursement programs in that the employees may choose from 16 preapproved schools and programs and the company pays tuition upfront, meaning students don’t have to drain their own bank accounts or add debt to their credit cards then wait for reimbursement.

Educating Homegrown Leaders Cuts Hiring and Attrition Costs

As the number of Walmart employees enrolled in the Live Better U program grows, so does the number of internal promotions at the company. In 2021, more than 300,000 US employees were promoted to jobs of greater responsibility and higher pay. The aforementioned Lumina Foundation study found that Live Better U education program participants were about 80% more likely to be promoted than nonparticipants.

The Live Better U program was created with a focus on career mobility, so associates stay and grow with the company. “We’ll be able to not only upskill and rescale folks for the job that they have today but the job for tomorrow as well,” says Williams-Moore. “It’s definitely a lever which we’re able to pull to help future-proof the workforce.”

Walmart has a proven track record of advancing its own employees. More than 75% of Walmart’s US store operations management team members started as hourly employees. (Most famously, Walmart CEO Doug McMillon got his start unloading trucks at a Walmart distribution center in Fayetteville, Arkansas, when he was a teenager.)

Walmart has access to one of the “biggest talent pools out there,” says Williams-Moore, and investing in its employees’ education will “fuel the future of our business and set ourselves up to be in existence for many years to come. It’s definitely a strategic initiative for Walmart, and we continue to see fantastic results from the program.”

Funding Employee Education Improves Productivity and Engagement—Now and Later

The Lumina Foundation study also found that Walmart employees who participate in the Live Better U program perform significantly better at work, not just compared to their peers who didn’t enroll, but compared to their own work history before joining the program. Employee performance ratings increased by an average of 10 percentage points within six months of enrolling, according to the study.

Other data also suggests that learners make better workers. According to LinkedIn’s most recent workplace learning report, eager learners who engage in five or more hours of learning per week are 74% more likely to know where they want to go in their career and 48% more likely to have found purpose in their work than employees who spend less than an hour a week actively learning.

Investing in Employee Education Creates Long-lasting Goodwill

A bonus benefit for companies offering employee tuition reimbursement is that the organization starts to build employee brand ambassadors, says Sallie Glickman, Co-founder and CEO of The Graduate! Network and an education expert who has worked with Walmart in the past. When employees do leave Walmart, she says, they’ll remember that the company helped pay for their education and pave the way for future success.

That goodwill means former employees are likely to recommend Walmart as a good place to work, further ensuring a never-ending pipeline of talent—and customers. “They might have a big job somewhere else now,” Glickman says, “but they’ll be Walmart customers for life.”

What’s more, a generous education reimbursement program benefits both employee and employer at relatively moderate costs, says Peter Cappelli, a professor of management and the director of Wharton’s Center for Human Resources at the University of Pennsylvania. Remote-education options don’t require room and board fees, and tuition-reimbursement programs are tax-deductible up to $5,250 per year. “It’s the kind of corporate benefit that can be very generous without costing so much,” he says, adding that these programs are more worker-friendly than ever, thanks to lower barriers to participation. “Now it’s easier to access because these programs are almost all online.”

In a time when companies are struggling to recruit and retain high-quality workers, offering employees a clear and easy pathway to career advancement is a symbiotic no-brainer. “Anytime you can do something that gets your employees to stick with you and feel good about your brand, that’s smart business,” says Glickman. “It’s a win for the employee, it’s a win for the employer, and there’s no downside.”

Related: Beyond the 401(k): Employee Benefit Trends New Hires Will Come to Expect