The ASU-Starbucks Partnership

In his book Pour Your Heart Into It: How Starbucks Built a Company One Cup at a Time, Starbucks CEO Howard Schultz wrote, "From the beginning of my management of Starbucks, I wanted it to be the employer of choice, the company everybody wanted to work for."

Starbucks just took one more step toward (re)affirming that goal.

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Starbucks and Arizona State University have entered into a new partnership that might hint at the future of post-secondary education. AZCentral reports:

Starbucks employees nationwide will be eligible for a free college education through Arizona State University's online program beginning this fall.
 

The new initiative, touted as the first of its kind, will allow many of Starbucks' 135,000 workers to graduate debt free from ASU with no requirement to repay or stay on with the company. The funding will come from a partnership between ASU and Starbucks. . . .

Under the program, Starbucks employees who work at least 20 hours a week will receive full tuition reimbursement if they enroll in ASU's online program as juniors or seniors.

Others will be able to apply for scholarships worth $6,500, on average, if they enroll as freshmen or sophomores in ASU's online program. And ASU advisers will help them apply for other, need-based financial aid, including coveted Pell Grants, the university said.

The ASU-Starbucks initiative emerged almost a year ago, when ASU President Michael Crow approached Schultz about ways to make college education more affordable. 

According to the Wall Street Journal, this new educational opportunity "is the most significant benefit [Starbucks] has rolled out since it introduced health-care coverage and stock options more than 20 years ago. Each of those programs cost the company more than $200 million last year."

I imagine we'll see more of these partnerships in the future. With private school tuition (including room and board) now regularly exceeding $40,000, different options are desperately needed. Even with substantial financial aid, students are finding college unaffordable. 

I have to mention, however, that the ASU-Starbucks partnership is not totally new. Jesuit education, at the high school level, has already seen these kinds of collaborations with its Cristo Rey network of schools. Students at these schools participate in a Work Study program with local businesses that ends up funding the majority of their tuition. See here to learn more about this network. 

 

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J Cosgrove
3 years 6 months ago
The rise in tuition costs over the last 20 years does not representative the real costs of education but instead was an opportunity to take advantage of subsidized education through government implied guarantees. The supply and demand curves have been distorted by subsidizing the demand side of the curve. If demand is subsidized there will be both more of it and at a higher cost. The most telling recent example of this was the housing crisis where demand was subsidized by government guarantees. The Jesuits control the largest number of Catholic colleges in the country and could easily lead the way in lowering tuitions. Why don't they? There is nothing stopping them from doing so. The educational costs have not gone up as fast as tuition's but that has not stopped Jesuit universities from raising prices. (I have a friend who works at a Jesuit university in the placing of students as they near graduation. She said that the standards for admissions have been lowered to get the necessary students to pay the high tuition costs with the resultant effect of the dumbing down of the educational experience.) One hope is that online course completion will the lower cost to get a degree and then lower demand for attendance at the brick and mortar facilities which may become obsolete for a some or most of education. By the way if the government figured out a way to subsidize the supply side then this would have the effect of lowering tuition. But we keep on making the same mistakes over and over again and which lead to major disruptions of economic life and which has the unintended consequence of major changes to the social construct of the society. There are less families and less children as a result of the increase of educational debt. When will we ever learn?
Bob Baker
3 years 6 months ago
Starbucks and gay marriage and Cristo Rey with ten of millions of dollars from the Gates Foundation. Nice partnerships.
Matt Emerson
3 years 6 months ago

Mr. Baker,

Thank you for reading and taking the time to comment. Would you be willing to elaborate on your response?

-Matt E.

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