McDonald’s on Thursday announced plans to invest $150 million over five years in education programs for its workers, using savings from federal tax reform to address one of the chain’s biggest problems: attracting workers.
The company is expanding its Archways to Opportunity program started in 2015, tripling the tuition assistance for crew members and reducing eligibility requirements.
Employees are eligible for the program after they’ve worked at a restaurant for 90 days, compared with nine months under the original program. And the company reduced weekly hour requirements from 20 hours to 15.
Crew employees will be eligible to receive $2,500 a year in tuition assistance, more than triple the $700 they would have received under the original program. Managers can get $3,000 a year, up from $1,050.
The program gives employees at the chain’s 14,000 U.S. restaurants the opportunity to earn a high school diploma, receive college tuition assistance, access free education advising services and learn English.
“Our commitment to education reinforces our ongoing support of the people who play a crucial role in our journey to build a better McDonald’s,” McDonald’s CEO Steve Easterbrook said in a statement.
McDonald’s said that the increased investment was “accelerated by changes in the U.S. tax law,” which lowered the corporate tax rate from 35% to 21%.
A handful of restaurant chains have vowed to use savings from the lowered rate to improve their standing with prospective employees. Starbucks, for instance, is investing $250 million of its tax savings on raises and benefits. Olive Garden owner Darden is investing $20 million on employee incentives.
With restaurants hiring at a higher than normal pace, and with unemployment at 4.1%, many operators struggle to find workers.
“By tripling tuition assistance, adding education benefits for family members and lowering eligibility requirements to the equivalent of a summer job, we are sending a signal that if you come work at your local McDonald’s, we’ll invest in your future,” McDonald’s Chief People Officer David Fairhurst said in a statement.
McDonald’s has awarded more than $21 million in high school and college tuition assistance to more than 24,000 people under the Archways to Opportunity program. Graduates have received college degrees in business administration, human resources, communications, accounting, microbiology and more.
McDonald’s has extended some services to families. The company is making online and college advisory services available to workers’ family members. It is also creating an international education fund with grants in global markets to improve education advancement programs.
Jaime Fall, director of The Aspen Institute’s UpSkill America, said that such an extension “can be game-changing for some families.”
And, he said, the upfront tuition payment “allows far more workers to take advantage of the program.”
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