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Walmart Offers To Foot College Tuition Bills for US Employees (bloomberg.com)
Walmart will begin offering to subsidize college tuition for its 1.5 million workers in the United States, joining a growing list of companies that are helping employees pay for higher education as a perk in a tight labor market. From a report: The retailer's 1.5 million employees can now pursue associate's or bachelor's degrees in business or supply-chain management at three nonprofit schools for $1 a day, according to a statement Wednesday. Walmart will subsidize tuition, books and fees and provide support with the application and enrollment processes. As many as 68,000 employees might sign up, Walmart executives estimated. "Many of our associates don't have the opportunity to complete a degree," said Drew Holler, Walmart's U.S. vice president of people innovation, in an interview. "We felt strongly that this is something that would improve their lives and help us run a better business." The tuition program -- offered to part-time staff as well as full-timers -- is the latest move by Walmart to improve employee retention and engagement. A handful of other companies, including Starbucks and Amazon, also offer tuition support.
If they raise pay, much of it is taxed away by payroll taxes (SS, SSDI, unemployment tax, etc) and is taxable income for the employee. Many of Walmart's employees qualify for EITC, and higher pay will push them out of that bracket. For every dollar extra that Walmart pays, about 60 cents ends up in the employee's pocket.
Tuition assistance avoids these problems. A dollar in is a dollar out.