If you've ever wanted to finally buckle down and get that online degree from Arizona State University, you might want to consider getting a job at Starbucks (NASDAQ:SBUX). The coffee chain just announced that it's going to support its employees in their undergraduate studies at ASU, phasing out its earlier program that partnered with the University of Seattle and Strayer University.
For investors interested in supporting employees, the move is just one more on a long list of reasons to invest in Starbucks. In its announcement of the perk, Chief Executive Officer Howard Schultz made it clear that Starbucks is all-in on employee benefits, saying, "In the last few years, we have seen the fracturing of the American Dream. There's no doubt, the inequality within the country has created a situation where many Americans are being left behind."
The benefit of an education
Under the new Starbucks plan, freshman and sophomore employees who work 20 hours a week will be eligible for partial tuition reimbursement, while junior and seniors can get full support. The program is similar to the program that Home Depot (NYSE:HD) runs, but a bit more generous. Under the Home Depot plan, employees can get 50% of their costs back up to a maximum of $5,000 per year -- Starbucks does not have a cap. On the other hand, Home Depot gives its employees five different universities to choose from.
Regardless of the restrictions or options offered, both companies have made a push for the education of their employees. For Home Depot, the goal is largely just to have the best employees that it can. Tuition reimbursement is dependent on the kind of course taken, and the company only offers assistance for programs related to the employee's job -- for instance, accounting or law.
Starbucks is making employee education part of its overall social platform. In recent months, the company has announced that it is holding open employee forums, that employees volunteered close to 250,000 hours in one month, and that Starbucks is planning to hire 10,000 veterans and military spouses by 2018.
Building the Starbucks brand
The addition of a more robust tuition reimbursement program fits into the Schultz method of brand management. Schultz called Starbucks "a brand and company defined by humanity and the human experience and what happens in our stores."
Starbucks and Home Depot have both made a move to get better employees with more commitment to the brands. For investors, that pays off over the long run. Better employees and happier employees have been shown to be more effective and productive for their businesses. It's easy to want to invest in a business because it's "doing the right thing," but Starbucks has shown that doing the right thing can also mean running a good business.