NEW YORK (AP) — Starbucks is giving its baristas a shot
at an online college degree, an unusual benefit in an industry where
higher education is often out of reach for workers.
The coffee
chain is partnering with Arizona State University to make an online
undergraduate degree available at a steep discount to any of its 135,000
U.S. employees who work at least 20 hours a week.
The program
underscores the predicament of many workers who earn low wages, don’t
have much job security and often hold down more than one job. It also
highlights the stark disparities in advancement opportunities between
the rich and poor, and how a traditional college education remains a
near impossibility for so many.
At an event in New York City on
Monday, CEO Howard Schultz told an audience of about 340 Starbucks
workers and their guests that the issue was personal because he was the
first in his family to attend college.
"I could care less about marketing. This is not about PR," he said of the cynicism he’s already
encountered about the program.
U.S.
Education Secretary Arne Duncan also appeared on stage to tell the
crowd that education has become increasingly crucial to succeed, given
the disappearance of blue-collar jobs that pay well. Duncan urged
workers to show other companies why they should follow in Starbucks’
footsteps.
"Think of the example you can set for the rest of the
nation," Duncan said. "If you guys can do this well … you’re going to
change the trajectory of the entire country."
Tuition and room and
board has climbed over the years, reaching an average of $18,400 last
year for local students at public schools, or $40,900 for private
universities, according to the College Board. With prices rising,
student loan debt has tripled since 2003 and is now the highest form of
household debt after mortgages, according to the Federal Reserve Board
of New York.
Michael Crow, president of Arizona State University,
said college has moved in a direction "where it’s all about exclusion"
and that public universities need a new approach to making education
accessible. He shot down the notion that an online education is an easy
way out.
Starbucks Corp., based in Seattle, said it doesn’t know
how many workers will apply for its prokgram or how much it will cost
over time.
One Starbucks employee from Los Angeles, Michael
Bojorquez Echeverria, said he works up to 75 hours a week, including at
another job, and attends community college at no cost. But he plans to
apply for the Starbucks program because he thinks it will offer greater
financial security.
He said he will miss is the socializing that
comes with attending school in person. "But hey, if they’re going to be
paying my fees, I can manage," he said.
Zee Lemke, a Starbucks
worker and union organizer in Madison, Wisconsin, said she thought the
program could benefit some workers. But she also noted the limitations
of the program, since the only option is to earn a degree from a single
university’s online program.
"Actual in-class experience matters," Lemke said.
Starbucks
said workers will have the freedom to pick from 40 educational
programs. And they won’t be required to stay with the company in
exchange for their education.
As with most matters involving
financial aid, the terms of the Starbucks program are complicated and
would vary depending on the worker’s situation. For the freshman and
sophomore years, students would pay a greatly reduced tuition after
factoring in a scholarship from Starbucks and ASU and financial aid,
such as Pell grants.
It would work in much the same way for the
junior and senior years, except that Starbucks would reimburse any money
that workers pay out of pocket.
That means employees who already have two years of college under their belts would be able to finish
school at no cost.
Online
tuition at ASU can vary but is about $10,000 a year. Most Starbucks
workers would likely qualify for a Pell grant, which can be as high as
$5,730 a year. Starbucks did not say how much money it is contributing
to the scholarship it’s providing with ASU.
Arizona State
University’s online program, which already has an enrollment of more
than 10,000, stands to benefit from the students Starbucks will send its
way.
There have been other efforts at offering low-wage workers
education benefits. In 2010, Wal-Mart Stores Inc. started offering
partial tuition grants for workers at American Public University, a
for-profit, online school.
Starbucks also already has program that
reimburses workers for up to $1,000 a year at City University of
Seattle or at Strayer University. The company said that will be phased
out by 2015 in favor of the new program.
Workers would have to
meet the same admission standards as other ASU students. Only workers at
Starbucks’ 8,200 company-operated stores would be eligible. Another
4,500 Starbucks locations are operated by franchisees.
The program is also available to Starbucks’ other chains, including Teavana tea shops and Seattle’s Best.