The Supply Side: Walmart nurtures leadership with free education, training

by Kim Souza ([email protected]) 490 views 

With more than 1.6 million U.S. employees, Walmart seeks to overcome workforce challenges and avoid a talent war. The retailer hopes to grow the next generation of leadership by offering free college education and workforce training in its academies.

Walmart CEO Doug McMillon started his retail career as a summer seasonal worker unloading trucks at a Walmart distribution center. Walmart U.S. CEO John Furner began his Walmart career as an hourly employee in the garden center at Store 100 in Bentonville to earn extra money as a college student.

“David Glass used to say anyone can have multiple careers inside Walmart because of the company’s size and scale, and that was before Walmart became a half-trillion international business, with one of the fastest growing advertising businesses in the country, a third-party logistics service provider, fintech partner, healthcare provider and technology powerhouse,” said Scott Benedict, affiliate partner with McMillanDoolittle retail consultancy.

Benedict also spent two decades working at Walmart and Sam’s Club and a decade with other retailers.

Walmart is the largest U.S. private trucking company, with over 13,000 drivers. However, the competitive recruitment of new drivers continues to challenge all carriers. In 2022, Walmart looked within its ranks to recruit a new class of drivers with a pilot program dubbed Fleet Development, and it has been a game changer, according to Fernando Cortez, senior vice president of transportation at Walmart.

In early 2022, Walmart began offering supply chain employees in Dallas and Dover, Del., a chance to apply for a 12-week training program to get their commercial driver’s license (CDL) and become a private fleet driver for Walmart where they earn up to $110,000 in their first year. Cortez said 56 employees from supply chain roles graduated with a CDL and became the Walmart fleet drivers last year and incurred no cost for the program.

Walmart turned to its veteran drivers to teach the written material and oversee the group of new trainees’ driving. Earlier this year, Walmart expanded the driver development program with plans to train 256 additional drivers, including in Bentonville. The new class of driver trainees came from stores, distribution centers, fulfillment centers and transportation offices within a 50-mile radius of a participating office where employees apply for the program.

“The program is a win for associates, who can take the next step in their career journey without leaving the company. It’s a win for Walmart, as we can continue to invest in our talented team of associates. And it is a win for customers and members, as our fleet continues to deliver every day,” Cortez said.

Walmart said this summer that 191 employees had completed the Associate-to-Driver program and received a CDL to begin driving for Walmart. Cortez said that starting next year, any employee who lives within 250 miles of a transportation office can apply to the program.

Ashley Milacek was one of the first store employees to graduate. Cortez said Milacek has held five jobs since beginning at Walmart Store #185 in Sanger, Texas, in 2014. She worked front-end, overnights, online grocery and general merchandise. When she heard about the opportunity, she didn’t hesitate to sign up to earn more for her family.

Ronny Suggs said he found Walmart when he was down on his luck, having worked there before several tours of duty in Iraq that eventually left him homeless. When the retailer was hiring veterans, he returned to work at Walmart Distribution Center 6094 in Bentonville and joined the Associate-to-Driver program.

Walmart also recently said it was waving the degree requirements for some roles in its corporate offices. This move is among a series of adjustments Walmart has made to its compensation and workforce requirements.

“We’re rewriting job descriptions for our campus (headquarters) jobs to factor in the skills people possess, alongside any degrees they hold,” Walmart executives wrote in a blog post. “This creates an either/or option for an applicant: to be considered for the job, you can have a related college degree or possess the skills needed for the job, whether through previous experience or other forms of learning. … While degrees should be part of the equation and in some cases even required, there are many roles where a degree is simply unnecessary, including at corporate headquarters.”

Benedict said Walmart’s willingness to broaden the scope of applicants is forward-thinking. After all, if the job candidate wants to finish college, Walmart has said it would pay for it.

“This type of investment in personnel can pay dividends for many years. Walmart has come a long way in its pay scale in recent years, and when adding in the benefits and education perks, it’s no surprise they are seeing less turnover,” Benedict said.

Walmart also said it was streamlining job titles across its corporate staff, but those changes are in title only. Walmart also said that in some cases, employee pay at Walmart corporate and Sam’s Club will be lowered for new hires starting in November. Walmart said stock option awards for the staff would mostly stay the same, but in some cases, they might increase. And about 4% of the staff would see a decrease in stock-option awards to ensure compensation is aligned across geographies. Walmart said those who see a reduction will also receive a stock grant to account for the adjustment.

Walmart changed its hourly starting wage structure for entry-level workers such as cashiers, personal shoppers, stockers and self-checkout helpers to the same level as the hourly wages paid to those who work in department roles across the store. Walmart standardized the hourly starting pay across the store and by geography. Walmart said the new pay structure will allow new workers to handle various duties, creating better staffing throughout the store. More than 50,000 Walmart workers received raises because their pay was below the new minimum.

Benedict said the tight labor pool forced retailers and others to raise starting pay amid the pandemic and immediately after. He said Walmart has learned to pay more and invest in training so promotions can come quickly, as will higher pay and better employee retention.

“I suspect Walmart researched what competitors are paying in their respective geographies and saw an opportunity to standardize starting pay in stores, clubs and home office support. Walmart tends to focus on spreading its investments across the different pay levels. But because they offer training from day one and tend to promote from within, the starting pay is typically much lower than average pay,” he added.

Lorraine Stomski, Walmart’s vice president of learning and leadership, said the wage package and the education and training opportunities are attractive even in a tight labor market.

Since Walmart launched its Live Better U education program in 2018 in partnership with Guild Education, Stomski said around 7,000 employees have graduated. That equates to promotions and higher pay in most cases. She said the most popular areas of study are business, healthcare and technology, which saw huge spikes amid the pandemic.

Editor’s note: The Supply Side section of Talk Business & Politics focuses on the companies, organizations, issues and individuals engaged in providing products and services to retailers. The Supply Side is managed by Talk Business & Politics and sponsored by Firebend.