Following The Theme Of Rebirth, Guild Education Now Valued At $3.75 Billion
Back in 2015, Rachel Carlson founded a company designed to help working adults without a college degree gain education through employer tuition benefits. It was a noble and important idea, so CEOs took notice. Today, that company, Guild Education, is valued at $3.75 Billion. And it’s starting to grow like crazy.
Why? Unlike traditional tuition reimbursement companies, Guild focused on upskilling and building Career Pathways for employees, attracting customers like Disney, Wal-Mart, Chipotle, Lowe’s, Taco Bell, and others. These companies use Guild to create life-changing education solutions for their employees. And this makes jobs better: better for employees, better for employers, and better for the economy.
If you read Waste Management’s description of the program, for example (just launched), you see how strategic this can be.
Your Tomorrow is a first-of-its-kind program that provides WM employees, as well as their eligible dependents, the opportunity to choose from a full range of education options, including earning a college degree, at no cost to the employee.
Other examples include Walmart’s BetterU, Disney Aspire, Chipotle Cultivate Me, and Low’s Track to the Trades. These programs go far beyond traditional tuition reimbursement: Guild works with the employer and education providers to build direct Career Pathways that include college degrees, new career skills, and new jobs for non-college-educated employees.
Now, as we follow the theme of Build Back Better in the US, this type of solution is more important than ever.
Let me cite some alarming statistics. The St. Louis Fed conducted a detailed study of the College Wealth Divide in 2020. The study, which looks at detailed education, wage, and wealth data for 60 years, shows that the value of a college degree has skyrocketed during this time.
Why? The US economy has become a service economy – and almost every high-wage job now requires reading, writing, communications, and technology skills. College and community college education reinforces these skills, and also gives people badly needed confidence and perspective on their careers.
While many employers now understand that college degrees alone do not guarantee success, it’s very clear that the lack of a college degree creates an enormous career handicap. And unfortunately, only 57% of working adults in the US actually have such a degree.
Why is this number so low? Many working people don’t have the time, money, or resources to go to school. A college or associate degree takes years to complete, and if you have a young family or work in a lower paying job, you simply do not have the money for tuition or time to go full time. And college tuition keeps going up. Study after study shows that the cost of college is growing at 2-3X the rate of inflation, creating a staggering level of student debt (over $1.3 Trillion).
For example, for the year 2020-2021, public two-year in-district colleges charged $12,850, public four-year in-state colleges cost $22,180; public four-year out-of-state colleges cost $38,640 while private nonprofit four-year colleges were the most expensive at $50,770 (Duffin, 2020).
Creating Career Pathways
I’ve known Rachel since she founded the company and I’ve always found the story compelling, important, and innovative. What Guild has discovered is that tuition reimbursement, a tax-free benefit to employees, alone is not enough. Companies have to craft particular degree-driven career pathways that help employees move forward. This is why Guild’s solution is so powerful.
We studied Tuition Reimbursement back in 2009 and found that more than 80% of employers offer some kind of program. But most are untargeted and viewed as a “benefit,” and many are used for advanced degrees. At the time only 13% of companies believed the program was “strategic to their business growth” and about half even felt it was aligned with their talent strategy.
Guild can change all that. The company works directly with CEOs and CHROs to move well beyond Tuition Reimbursement as a “benefit.” Guild looks at the company’s front-line employee base and develops an easy-to-use, targeted set of education and career programs that leverage the power of degrees, credentials, and careers in the company.
And this is going to become more important than ever. In the ever-tightening labor market, companies are now finding it hard to attract workers. Guild’s offering adds tremendous value to a company’s employment brand, creating a valuable and affordable way to attract the best candidates for any front-line job.
This is an urgent problem. Just today the NY Times noted that we have 23 million workers in the US who make less than $30,000 per year. These people need more than just courses, they need credentials, career guidance, and opportunities. Companies have the opportunities, now they need the workers.
Many years ago McKinsey did a big study of the misalignment between the education industry and the needs of employers. They discovered, as I’ve found many times in our research, that education institutions simply do not understand or focus their degrees on the needs of ambitious workers. Guild Education can fill this gap. The company also works closely with educational institutions to help them align and target their programs to the needs of big companies.
And much of this need is in the “front-line” workforce, where Guild has focused its efforts. A study just released by the Conference Board found that 80% of companies with frontline workers feel it is “very hard” to find talent, vs. only 60% for companies with professional and office workers.
I am thrilled to see Guild’s success over the last six years. This is a hard-working, creative company that adds real value to today’s critical talent, economic, and social issues. We will be publishing case studies on these Career Pathways soon, so stay tuned for more on this important topic.
What Is A Career Pathway? Here Are Some Examples
Taylor H., Discover: Graduate, Wilmington University, Bachelor of Science in Software Design and Development — was at Discover for seven years in customer service, and earned a promotion to team leader and analyst. “I found my niche, I get more satisfaction with project building.”
Gina M., Walmart: Graduate, Penn Foster Pharmacy Technician Career Diploma — Gina worked at Walmart in online grocery pick-up, then enrolled in the Pharmacy Technician Career Diploma program. She graduated and now holds a job as a Pharmacy Technician.
Alexis B., Disney: Previously worked at Disney, now at Oracle, Graduate, Bellevue University, Bachelor of Science in Marketing. Took a course in data analytics as part of her degree and recently got a new job at Oracle after graduating which is focused on technology work and is double her pay.
Brandon G., Lowe’s: Graduate of Penn Foster Appliance Repair Career Diploma. Works at Maine’s nuclear waste facility (Paul’s home state) as an Independent Spent Fuel Storage Installation Security Specialist after completing a program with Lowe’s. “My jobs have always been sort of like jumping puddles … I got a position at Maine’s only nuclear waste facility … It’s the best job I’ve ever had.”
More Information On This Topic
Career Management Archives: a library of articles on various aspects of career management.
My conversation with Greg Pryor, Talent Leader at Workday, on Careers in the Future