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Solving the Growing Skills Gap with Corporate Tuition Assistance

How Business Champions are shrinking the U.S. skills gap

Solutions for a Pressing Issue

The demand for skilled workers has never been greater. By 2018, 63 percent of jobs will require some college education and it is estimated that by 2020, 123 million skilled workers will be needed. Yet today, only 50 million people possess the skills and credentials – for jobs like medical coding, welding and many others – to meet these needs. Already this gap is being felt, with four out of 10 U.S. employers reporting difficulty in filling open positions.

This skills gap is hurting employers large and small. With millions of job openings and an insufficient number of workers with the right college or vocational training to fill them, business leaders have important decisions to make. One viable solution to help solve this gap is rethinking the corporate investment in tuition assistance programs.

Today, 61 percent of U.S. organizations offer tuition assistance to their employees, a trend that looks to continue – or perhaps even increase. This benefit pays dividends for employers that offer it; employees offered tuition assistance stay longer, become more engaged and productive, and creates a workforce that has the necessary skills to be truly future-ready.


Champions for a Skilled Workforce

Business Champions, funded by the Lumina Foundation and managed by CAEL, is a group of senior strategic leaders at top companies representing a wide range of sectors including agriculture, education, retail, healthcare and hospitality, ending the skills gap is essential.  The group’s mission: Help more companies build a next-generation American workforce. With a commitment to increasing the number of educated and credentialed workers, Business Champions have proven that offering a good tuition assistance program pays off in more ways than one.

Talent Investments Pay Off, a recent Return on Investment (ROI) study completed by Accenture with funding through the Lumina Foundation, assessed the implementation of the Education Reimbursement Program (ERP) at health insurer Cigna, a member of Business Champions. The Lumina-led study noted multiple examples of measurable returns on investment, including:

  • Cigna not only recovered every dollar invested in into its reimbursement program, but also saved an additional $1.29 in talent management costs
  • Frontline employees who took advantage of the tuition program saw 43 percent incremental wage gains
  • Employees who participated in the ERP program were 10 percent more likely to receive a promotion and were eight percent more likely to be retained compared to non-participating employees

“Our Leadership team intuitively knew that ERP was a good benefit, but we could never prove that it was a valuable business investment. We were delighted that the proof was there in the ROI study. Now, we can be bolder and more strategic in our focus.”

– Karen Kocher, Cigna Chief Learning Officer

Best Practices for Tuition Assistance

As demonstrated by the Lumina/Accenture ERP study, companies can benefit greatly by offering a tuition assistance program to employees. Beyond upskilling employees to foster a future-ready workforce, employers who take advantage of tuition programs increase employee retention, confidence and motivation.

Looking to implement a tuition assistance program of your own? It’s worth it to take the time to look at the company’s growth goals and ensure you are being strategic in developing your tuition program policies. Ask the right, though sometimes difficult questions, such as whether the program should be reimbursement or pre-payment – which increases participation rates. Consider including all employees in program eligibility, covering all mandatory fees, and including certifications and certificates. There are many other important considerations to look at when creating or revising your tuition policy, and good data available, so consider talking with an expert on tuition assistance programs when crafting your program policies.

Transform Your Tuition Assistance Program from an Employee Perk to a Powerful Investment

A tuition assistance program is only successful if employees are made aware of its existence and take advantage of its benefits. Research shows that less than half of all employees are aware of their company’s program, which can be attributed to many factors. Some organizations do not understand the strategic benefits of offering tuition assistance and so “hide” the program as a way to control costs. Some organizations that do advertise their program might do so in such a way that confuses employees. For many employees, the only time they hear about their organization’s tuition assistance program is during onboarding. With everything else they are learning during the tumult of adjusting to a new position, they may simply forget it exists.

Regardless of why employees are unaware of a tuition assistance program, it makes good business sense that company leaders take steps to bring its existence to light.

Beyond providing a clear, easy to understand explanation of the scope and requirements of your organization’s tuition assistance program, there are additional ways your organization can effectively promote these programs that cultivate career development and mobility. Some useful methods of communicating your tuition program include:

  • Recognize employees who graduate in company newsletters, bulletin boards, social media, etc.
  • Follow-up with new employees and remind them about tuition assistance benefits after they’ve acclimated to your organization
  • Make clear to employees both the personal and professional benefits of expanding their learning
  • Develop partnerships with education partners and make the relationships clear to employees
  • Keep managers informed about the program and encourage them to impress its value on employees

Tuition assistance for a stronger workforce

Appreciating the value of investing in a tuition assistance program for employees of all levels is crucial for stemming the tide of an increasing skill gap. Through studies like Talent Investments Pay Off, Business Champions ( are helping to spread the word about how businesses can help employees prepare for degree and certification completion or advancement. When employees gain increased access to education, everyone wins.