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Companies with tax overhaul cash to spare are rewarding workers in the short-term with bonuses to boost morale. Others are pursuing workforce training and development initiatives in an effort to make the morale last long-term.
Businesses that can help their employees learn and improve their career trajectories can better compete in a tight labor market. These kinds of investments, however, are unique among employer announcements of how tax savings will be reinvested: Apple, AT&T, Comcast, Wells Fargo, Home Depot, and others have announced one-time bonuses or wage increases with savings from the new tax law.
Boeing is among a handful of companies to buck the bonus trend. The aerospace giant is investing $100 million in career learning, training, and development programs—one-third of the $300 million in tax savings it is reinvesting in company programs, Bethany Tate Cornell, vice president of leadership, learning, and organizational capability at Boeing, told Bloomberg Law.
“We chose this investment with tax savings because our people are our greatest strength,” Cornell said. “It’s critical to Boeing that everyone feels they have the ability to grow in the company and live a culture of continuous learning.”
Boeing may not be among just a few few for long, though. Many companies are engaging in additional training and programs to provide different types of work experiences, such as new projects or work in new business sectors, and are making investments in technology to allow for more flexible work options, Ken Esch, a partner in PricewaterhouseCooper’s Chicago office, told Bloomberg Law. “Bonuses are just one component of the ways employers” are trying to retain employees, he said. “They are also expanding recognition programs, more time off, flex work, and job assignments.”
Before 2008, many larger businesses had robust career development programs, Constance Jenkins Pritchard, owner and president of career development and training consulting firm The Pritchard Group Inc., told Bloomberg Law. As the economy tanked during the recession, “most of those programs pretty much went away.” There’s been a rebound in the last three or four years of those programs returning, due mostly to economic pressures, she said.
Boeing’s $100 million investment in learning and development programs will be a long-term investment that begins in 2018 but will extend for years to come, Cornell said. Boeing began developing programs by surveying employees about what they wanted most for learning, training, and development. The company received more than 43,000 responses.
“We’re focusing on the greatest need from employees,” Cornell said.
The voting breakdown showed that 39 percent of responding Boeing employees wanted better technical development programs; 29 percent requested new skills for jobs affected by new technology; 16 percent wanted modern, accessible learning platforms; and 16 percent wanted more support for first-line leaders.
Overall, employees wanted programs that are “meeting learners where they are in the company” and creating more forms of learning so that the educational opportunities are available when workers need them. This kind of on-demand learning can come in many forms, Cornell said, including micro degrees, podcasts, massive online courses, or traditional online e-learning.
According to research from PwC, 80 percent of business leaders said they expect to realize tax savings on average of 5.16 percent, and a majority of those companies (56 percent) said they would be directing those savings to increased wages, new hiring, and bonuses.
Other organizations are planning to boost benefits for health and wellness.
PwC, for example, launched a Family Benefits Enhancement program that adds two more weeks to its paid parental leave and allows new parents to transition slowly back to work, a PwC spokeswoman told Bloomberg Law. The firm also is giving $45 million via $1,000 bonuses to employees at all levels to be used specifically on wellness.
“This program is aimed to maintain our competitive position in the workforce and to invest in our people. It also helps our employees at a critical time in their lives and allows us to compete for top talent” she said.
JPMorgan Chase announced in January it would increase wages at branch locations with tax law savings. The banking institution also plans to adjust health-care benefits to “ease the burden of out-of-pocket medical expenses” by reducing medical plan deductibles by $750 per year for employees making less than $60,000, a spokesman told Bloomberg Law.
To contact the reporter on this story: Genevieve Douglas in Washington at firstname.lastname@example.org
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