Anthem Blue Cross and Blue Shield has added a free tuition option to its education benefits package for its 1,400 Connecticut employees, bolstering a perk that some companies are now reinstating and better aligning with their talent-management strategies as the economy improves and labor market tightens.
"The big focus is on talent development and investing in our employees, providing them another means to higher education for career advancement," said Anthem spokeswoman Sarah Yeager. "It's another way to be able to do that."
Through a partnership with College for America, an online education institution started by Southern New Hampshire University, Anthem is offering part- and full-time employees, who have been with the company at least six months and work at least 20 hours per week, the chance to earn an associate or bachelor's degree at no cost.
In addition, Anthem provides up to $5,000 annually in tuition reimbursement for college classes at accredited institutions, Yeager said. In that case, students incur out-of-pocket expenses for which they are reimbursed. With the online College for America program, Anthem picks up the $2,500 annual tab upfront.
Anthem's new education benefit reflects a broader trend of more companies partnering with universities or colleges, particularly online institutions, to provide free or discounted higher education to employees, said Leonard "Lenny" Sanicola, a certified benefits consultant at WorldatWork, a nonprofit human resources association.
Sanicola said education assistance programs are becoming less of a benefit and more of a talent management strategy.
Companies are asking, "How can we use it to our advantage in terms of recruitment and retention and moving people to higher-level jobs?" he said, adding that tuition reimbursement programs are used as a business objective, "whether that be corporate social responsibility, or being able to attract and retain employees as part of their talent management strategy."
Tuition-assistance benefits have stabilized after many companies reduced or eliminated them during the recession, he and other HR experts said.
The Society for Human Resource Management noted in a 2014 survey that 54 percent of companies offered undergraduate assistance and 50 percent offered it for graduate studies. That was down from 61 percent and 58 percent, respectively, in 2012.
"The decline in the percentage of organizations offering educational assistance benefits comes just when many organizations are reporting increased difficulty in finding jobseekers with the educational qualifications needed for many high-skilled jobs," SHRM's 2014 survey said. "The decline in educational benefits offerings could lead to future skills shortages."
SHRM research showed 55 percent of HR professionals expect more demand for candidates with a bachelor's degree, and 41 percent expect a need for more advanced degrees.
The study said if minimum job education requirements continue to increase in the future, employees will expect additional benefits to help offset the cost of education.
Jay Titus, senior director of academic services for EdAssist, which designs and administers tuition assistance management services for numerous Fortune 1000 companies, said Millennials especially value professional development, even more than regular pay raises in many cases.
More employers recognize that's something they need to offer, no matter their size, he said.
"We're seeing, whether you're a small company or a large company, investing in your workforce is something that you need to be doing because you're competing for the same talent, regardless," he said.
Titus said companies are also getting more creative with their education-assistance programs, with many looking for shorter, faster ways to educate employees to cover skills gaps. He sees more short-term certificates, boot camps and certifications from academic partners.
Bruce Elliott, SHRM's compensation and benefits manager, said he expects to see more large companies partnering with education institutions the way Starbucks Corp. recently did with Arizona State University, offering full-tuition coverage for all four years of a bachelor's degree through ASU's online degree program.
"By implementing something like this, they're probably seeing a benefit that far outweighs the cost," Elliott said.
Do companies worry about paying to educate their employees only to see them leave for other employers?
It is a concern, said Anthem's Yeager.
"But it also might mean that they'll get a promotion or they'll be considered for a position in another department that they would not have been considered for," she said. "If you work at a company where they're truly investing in you and investing in their associates and providing them opportunities to learn and to better themselves and provide opportunities for advancement, I think that that speaks volumes."
Dennis Binkowski, 28, quality assurance services team lead at Corporate Translations in East Hartford, can attest to that.
He received tuition assistance from his company to help him obtain his MBA in May from the University of Hartford.
"The assistance was huge for me," he said, not only financially, but also in scheduling flexibility the company offered around classes.
"We work in a very competitive business landscape today and to be able to have an employer who invests time and effort into you and sees value in you as an employee and a professional and is willing to assist you with your academic goals, it's huge," Binkowski said. "It signals that the company wants to invest in you and they have long-term plans for you."