The U.S. labor marker is very tight as unemployment numbers recently hit a 50-year low in September, which has human resource departments in industry all across the United States scrambling for ways to keep current workers and attract new workers.
The United States’ largest private employer and retail giant, Walmart’s recruitment plan involves hiring more teenagers. The retailer which has 2.2 million employees globally, of which 1.4 million are located in the U.S. fewer than 2 percent or about 25,000 are teenagers currently in high school. Walmart acknowledges that’s a very small percentage of its labour force and is especially low when compared to its competitors in the industry.
But Walmart is trying to change those statistics with a new recruiting approach focused on attracting high school into its labour force by offering: high school students free SAT and ACT prep, subsidizing a large chunk of their tuition, and offering them the chance to earn some (7 hours) college credit.
The company is working with a Denver-based startup called Guild Education that offers a program costing a dollar a day at several non-profit universities with online programs that have had success working with adult learners. It also said it’s expanding the number of degrees beyond business and supply management to an additional 14 that will include cybersecurity and computer science.
Walmart says these programs will help provide workers with skills it needs in the future.
About 7,500 adult workers are already enrolled in the program. Walmart expects 68,000 of its employees to be enrolled in the next several years.
The enticements are part of an expansion of a program Walmart launched last year offering affordable access to a college degree for full-time and part-time workers who have been with the company at least 90 days. Still, reaching out to high schoolers represents a challenge, given that fewer teens are entering the workforce than in previous decades due to academic pressures and an increase in summer school enrollment.
But Walmart is counting on the benefits as a way to attract high school students who are worried about the rising cost of a college education.
Walmart and many others like Starbucks, McDonald’s, Disney and Chipotle offer similar education benefits and also understand that hiring employees early in their careers comes with a number of benefits to the company. One of the most important benefits to the company is that is costs less to employ them, and it’s typically easier for the company to train them to fit the company’s needs. Plus bring in younger employees means they are likely to have formed bad habits with their previous employers reducing the cost of training or if old habits need to be changed, retaining.
However, teenagers aren’t working nearly as much as they used to because of increased pressure to be active in outside the classroom activities such as sports teams, clubs and volunteering to build their application for college not the work force.
The moves come as Walmart and others seek to recruit and retain higher quality entry-level employees in a tight U.S. labor market, while looking for untapped labor pools. Teens who do want to work face competition from older workers, young college graduates or foreign workers.
In fact, less than 27 percent of American teens are expected to have a job by 2024, according to the Bureau of Labor Statistics. That’s down from 34 percent in 2014 and down almost 30 percent from 1986, when 57% of Americans ages 16 to 19 were employed which has declined steadily since 2002.
The big question remains about how long these programs will last. Is this the new norm for big retailers and other business, or will these benefits disappear when the job market turns, I guess time will tell us that answer.
by Greg Rodman