Earlier this month, family, friends and co-workers gathered at the Amazon fulfillment center in Shakopee to support 88 employees who had taken advantage of the company’s education-assistance program.
This was the first group of Amazon workers in Minnesota to tap into the online retailer’s $700 million push to “upskill” about a third of its U.S. workforce with on-site training and tuition reimbursement over the next six years.
Since rolling out the program in 2012, Amazon said more than 25,000 workers worldwide have received training in such fields as machine tooling, medical lab technologies, computer-aided design, nursing and aircraft mechanics.
The education-assistance program serves Amazon’s interests to prepare entry-level workers for a workplace increasingly dominated by technology.
It is also a way to recruit and retain workers in a tight labor market, even if some employees will use their degrees as a steppingstone to a better-paying job outside of Amazon.
“We are becoming a link between education and employers,” said Tammy Thieman, Amazon’s Seattle-based senior manager for the Career Choice program. “We don’t want to build a bridge to nowhere. We are very deliberate about making sure our education programs are relevant to the current marketplace.”
While technology also creates jobs, a lack of workforce skills is a growing concern for the future health of the U.S. economy. About a quarter of the U.S. workforce is at high risk of losing jobs to automation, according to a Brookings Institution report.
The U.S. spends less than any other industrialized country on active labor-market policies that help train workers and match them to jobs, Brookings researchers pointed out. Meanwhile, employer-supported training, one of the main forms of skill development for workers, has been steadily declining.
Corporate programs play an essential role with on-site training and continuing education to help workers advance their careers, state officials said.
“Our state workforce is stronger when we invest in our people,” said Hamse Warfa, deputy commissioner of workforce development at the Minnesota Department of Employment and Economic Development.
Amazon’s Career Choice program is available to full- and part-time employees who have worked for the company for at least a year. The retailer prepays as much as $3,000 annually for full-time workers to cover up to 95% of tuition, fees and textbooks for as many as four consecutive years.
In some cases, classes are offered on site. Employees also may take classes online or at community and vocational colleges.
Amazon limits the program to two-year associate degrees or vocational certification in certain areas of study, based on the Bureau of Labor Statistics’ analysis of in-demand and “well-paying” jobs. Areas include health care, information technology, computer science, construction, mechanical and electrical trades, transportation and logistics.
Michael Schoenman became part of the inaugural class at the Shakopee facility, completing an 18-week course to earn a certificate in welding.
He has worked at Amazon for almost two years, starting as a packer, and now helps coordinate training of new hires and managers.
With a high school diploma and a few college courses under his belt, Schoenman, 33, has dreamed of building a taco cart. An on-site welding class gave him the “hands-on” training he needed, he said.
“Amazon made it appealing to me,” Schoenman said, “by bringing it to the site and offering to pay for it.”
Managers gave him flexibility from his shift, which runs Sunday to Wednesday from 6 a.m. to 4:30 p.m., so that he could attend classes during the workday and on days off.
The coursework made for some busy weekends at his Belle Plaine home as he studied for tests. But Schoenman, whose young daughter Oaklyn attended the graduation, said the program gave him new skills without putting him deep into debt — unlike a brother who spent $12,000 to become a licensed electrician.
An assessment by the Century Foundation that compared programs offered by Amazon, Walmart and Starbucks noted that all three “free” education-assistance programs limit worker’s choice and come with stipulations. In some cases, credits might not transfer if someone wanted to pursue a bachelor’s degree.
Most employers cap contributions at $5,250 per year per employee, because that is the maximum eligible for tax-exempt status, the Century Foundation said.
Amazon’s Thieman said that the company is committed to “removing barriers” and that interest in the program remains high. The company expects to have more than 60 on-site classrooms at its facilities by the end of 2020.