Put yourself in the shoes of a working professional who needs to upskill to better their career prospects and financial situation, or a parent who needs to pay for college for their dependents. Which employer do you think these employees would choose – the one that offers good Comp & Benefits or the one that offers great Comp & Benefits including Education benefits such as Tuition Assistance and Scholarships to cater to employees in each stage of their career? Of course, the latter. Now ask yourself – which one are you? We are talking about roughly 80% of your workforce and if you can’t confidently say that you belong to the latter group then let’s look at some facts below which will help you figure out your education benefits strategy.
The cost of education is a major financial burden on many families. On one hand, the wage gap between degree and non-degree holders is widening and on the other, the cost of education is rising. The college tuition inflation data indicates that the cost of tuition at public 4-year institutions increased 36.7% from 2010 to 2023. About 90% of mid-size and large-size employers offer Tuition Assistance or Reimbursement as a benefit, yet 87% of CEO are reporting skill gaps and a high need for upskilling in their workforces. This indicates that there needs to be something supplementing your Tuition benefits.
The answer is Scholarships.
The data on typical yearly educational funding shows that parental contributions cover around 40% of college costs; a close second is scholarships and grants pegged at 25%. Close to 2 million scholarships are awarded each year; the U.S. Department of Education alone awards 46 billion dollars in scholarships and private sources award close to 8 billion dollars in scholarships annually. Almost none go unclaimed. Such is the impact of scholarships!
Scholarships help reduce the ticket price of a degree thereby offsetting the cost of education for millions of school-goers who apply for scholarships each year through federal, academic, or private organizations.
Scholarship as an Education Benefit has distinct advantages for employers.
Enhanced Skills in the Workforce: It’s evident that the employees going through the upskilling programs or degrees bring back their knowledge and skills to the job and the employer benefits from it.
Attracting an in-demand Talent Pool: Better education benefits lead to better recruitment results by attracting high-potential candidates leading to an enhanced talent pool.
Higher Productivity: A highly skilled workforce produces higher job outcomes.
Increased Loyalty: Investing in your employee’s career and financial growth shows that you care and builds loyalty among employees.
Higher Retention Rates: An engaged and loyal workforce is likely to stay with the employer much longer leading to high retention rates or low attrition.
Increased Brand Image and Loyalty: All of the factors above build a brand’s image and social perception eventually leading to customer loyalty and an enhanced bottom line.
Workplace Scholarships have been a great tool in the recruitment and retention of employees in all stages of their careers. Scholarships supplement tuition assistance/reimbursement dollars to retain early- to mid-tenured employees looking to upskill or complete a degree. Dependent Scholarships help retain the sections of the workforce that don’t utilize the Tuition benefits. Scholarship as a benefit is multi-faceted. They can be used strategically towards targeted populations that you are trying to cater to depending on the needs of your organization.
Read ABCs of Scholarships as an Education Benefit
It’s worth mentioning that regardless of the type or strategic intent of the scholarship – dependent or employee – each of them will have the common elements of administration like the application process, letter of recommendation, a baseline GPA cut-off, enrollment verification, reviews, and finally cutting checks for the awards. The scholarship process, even though it sounds simple, is best handled by a third-party organization specialized in these services because of the IRS requirements for Grants to Individuals. Additionally, even though these benefits are essentially tax-free when used for qualified educational expenses there are certainly more details around taxation that learners and employers need to be aware of while rolling out this benefit.
A successful scholarship program is complex, work-intensive, and needs to be managed in meticulous detail. By choosing Edcor, you can avoid all the hassle and get even better results from these programs. We believe that one size never fits all and customize the scholarship administration experience based on your unique needs. We,
- Take the whole process Online for easy administration and tracking.
- Review scholarships to determine that learners have met all the requirements that fit your individual needs, policies, and budgets.
- Process Payments Seamless to recipients.
- Support administrators, learners, and your employees via our established Contact Center.
There is no better time than ‘now’ to include Scholarships in your Education Benefits portfolio to make it more holistic. Reach out to us for counsel or if you want us to design and administer a scholarship program for you.
Edcor is a woman-owned business and is the benchmark in education benefits administration. For 40+ years, our customized service and solutions have allowed Fortune 500 Clients to use education benefits programs for employee recruiting, retention, and development. Please feel free to reach out to us!
By Spardha Khera, Edcor
