Dive Brief:

• Chick-fil-A is investing $24 million in scholarships for nearly 12,700 employees across the country. The scholarships can be applied to any area of study at any accredited university.
• According to a company press release, 2,200 of those scholarships are funded from sales from the chain's bottled sauces, launched in 2020 and available at select retailers. Since its launch, retail sales of the bottled sauces have contributed more than $6.4 million to the chain's Remarkable Futures Scholarships program.
• More restaurant chains are adding benefits and perks in an effort to retain employees as the industry experiences a quit rate that is roughly twice that of the overall economy, and as nearly 40% of restaurants say they are understaffed.

Dive Insight:

These benefits and perks have included everything from higher pay to same-day pay to vacation reimbursements. Scholarship programs provide more of a long-term incentive for employees, however, increasing access to higher education as financial barriers tend to be one of the major deterrents of attending college.

Such programs can signal that chains are willing to invest in employees for the long term, whether they stay with the company or pursue a new career path. On the average, those with a bachelor's degree earn about $32,000 more annually than those whose highest degree is a high school diploma, according to the Association of Public and Land-Grant Universities.

There is evidence these programs promote retention. Starbucks began offering its Starbucks College Achievement Plan in 2015, combining scholarship and reimbursement funds to help employees earn their first bachelor's degree. The program has helped Starbucks attract and retain workers, according to EdSurge. Participants stay at Starbucks 50% longer and are promoted at three times the rate of employees who don't participate in the program.

Starbucks has since expanded the program as a pilot in the United Kingdom, while several chains have also since added tuition benefits, including Taco Bell. In 2019, Chipotle announced it will cover 100% of tuition costs through its partnership with Guild Education. The company says students enrolled in the program, called Cultivate Education, have a retention rate 3.5 times higher than non-participants. Further, the company says crew members using the benefit are 7.5 times more likely to move into a management role within the company.

Chick-fil-A’s program awards scholarships to recipients upfront without a tuition reimbursement requirement, and without a requirement of hours worked or length of service to qualify. These scholarships can also be used at any institution, whereas Starbucks' program is limited to Arizona State University.

Conversely, Starbucks partners must work an average of 20 hours a week to be eligible, while Chipotle employees must work for at least 15 hours per week for four months to qualify.

Chick-fil-A has been awarding scholarships since 1970, with more than 80,000 employees reaping the benefits. It has invested more than $136 million into its program and it has yielded success and, as turnover is costly, a return on investment. Ninety percent of scholarship recipients said they intend to work for Chick-fil-A even after they earn their degree.