Walmart recently announced that it would invest nearly $1 billion over the next five years to pay 100 percent of college tuition and books for associates, a move that comes as businesses are seeking to fill open positions during the current labor shortage and the post-vaccination jobs reshuffle.

Since starting the project in 2018, Walmart’s “Live Better U” program has enrolled 52,000 students and boasts roughly 8,000 graduates. Associates can pursue an education at any of Walmart’s ten partner institutions that focus on educating working adults, including Johnson & Wales University and Purdue University Global. Walmart limits its employees’ study options to in-demand fields including supply chain management, network security, and computer science as well as pertinent certifications or language courses. Amazon and Gap have taken similar targeted routes, supporting coursework only if it meets immediate or projected future skills needs.

Despite the popularity and practical draw of targeted programs that limit coursework, there’s a good argument that providing flexibility in educational choices would be more beneficial for employers by diversifying employee skill sets and improving the acquisition of noncognitive skills like critical thinking, interpersonal relationships, and communications. Such skills are associated with advancement to management positions and function as “master skills” that allow workers to more easily and quickly build new technical skills and adapt to ongoing technological change.

In the past, flexible and individualized tuition reimbursements were more the norm. In these programs, employees could use funds to pursue an education not necessarily related to the skills demanded by their current employer or industry. Further, critics of programs like Walmart’s point out that the take-up rates are actually quite small — typically around 6 percent or less. At Walmart a little over 3 percent of the company’s 1.5 million US employees are currently taking advantage of the opportunity to upgrade education and skills.

Employer-sponsored tuition programs of any kind have been in decline for decades. Many of the top employers in the 1950s had tuition reimbursement programs. One survey found that in 1992, over 80 percent of companies offered some kind of tuition assistance. Today, that rate has fallen to just over 60 percent. While Walmart’s program may be limited in both skills breadth and employee uptake, it is a step in the right direction.

There is no silver bullet for resolving America’s skills gap, but broadening and deepening employer-directed investments in education and training is a vital element in helping mid-career workers advance in our rapidly transforming economy.

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