After the US Congress cut the corporate tax rate from 35 to 21 percent in December, the airplane manufacturer Boeing announced that it would spend $300 million of its tax savings on corporate giving and employee programs, including a $100 million investment in learning and development over the next several years. The company is deciding how to structure that investment based partly on an internal survey, which found that 39 percent of Boeing employees wanted better technical development and 29 percent wanted new skills for jobs affected by new technology.
Now, we’re starting to see how Boeing is spending that money. The company announced several new education initiatives this week, focused on digital skills development and diversifying the company’s talent pipeline, GeekWire’s Alan Boyle reports:
The initiatives include a partnership with Degreed.com to give employees access to online lessons, certification courses and degree programs. Another initiative will put $6 million into a partnership with the Thurgood Marshall College Fund and several historically black colleges and universities. That investment will support scholarships, internships and boot-camp programs to help students experience what it’s like to work at Boeing, the company said.
There’ll also be several new programs to help Boeing employees enhance their technical skills and keep up with industry trends. The focus of the first program will be digital literacy, Boeing said.
In the wake of the Tax Cuts and Jobs Act passed by the US Congress in December, which slashed the corporate tax rate from 35 percent to 21 percent, some large employers announced that they were raising pay, expanding benefits, or (most commonly) issuing one-time bonuses for their employees with the billions of dollars in savings they would gain from the tax reform package. Critics of these tax cut bonuses say they are a cynical attempt to curry favor with the Trump administration and mask the fact that investors are reaping the lion’s share of the rewards. Most of the windfall is being passed on to shareholders through dividends and stock buybacks, as the Wall Street Journal noted in a recent article noting the impact of the tax cuts on corporate earnings in the first quarter.
Some companies are investing their tax cuts in in employees in a different way. The aerospace manufacturer Boeing, for example, announced in December that it was investing $300 million of its tax savings in employee programs, one third of which would go toward learning and development (its total savings from the tax cuts are expected to be around $400 million a year, the Seattle Times reported in January).
In fact, many organizations are putting part of their tax savings toward learning: Our pulse survey on tax reform at CEB, now Gartner, found that among organizations allotting part of their tax savings to HR, 39 percent were investing in employee training, development, and education—the second most common target for these allotments after pay and benefits. (CEB Total Rewards Leadership Council members can see the full results of that survey here.)
Major tech employers trying to diversify their workforces often say they have difficulty doing so because of the “pipeline problem”—i.e., there just aren’t enough qualified candidates from the groups they want to include, or they’re too hard to find. That’s not a great excuse for sluggish progress on diversity and inclusion efforts, as Facebook found out the hard way in July when it tried to pin a weak diversity report on the pipeline problem, but it’s true that women and minorities get fewer opportunities and less encouragement to follow the educational tracks that lead to tech jobs, so if businesses want to hire more diverse groups of technical employees, it makes sense to look at ways to support the STEM education in underrepresented communities.
One way to do this is to support nontraditional educational programs like coding bootcamps, which train students in skills with direct applications in the job market. The White House is also supporting several initiatives to improve access to both traditional and nontraditional STEM education in these communities. Some private sector organizations are also stepping up their efforts to support STEM education, with a view to expanding and diversifying their own talent pipelines and filling critical skills gaps. Boeing, for example, just announced $6 million in grants to Washington state universities and nonprofits to support STEM education at the elementary, secondary, and college level. Alan Boyle has the story at GeekWire:
Grants totaling $1 million are going to the University of Washington, Washington State University and Seattle University. The other $5 million will be divvied up among about 50 nonprofit groups and educational institutions across the state.