November 20, 2019 Finance and Tech Publication

Starbucks CEO: We plan to hire 5,000 veterans annually

After meeting its goal to hire 25,000 veterans and military spouses six years ahead of schedule, Starbucks has committed to hiring 5,000 each year, CEO Kevin Johnson told CNBC’s Jim Cramer on Friday.

“They make us a better company,” Johnson said on a Veterans Day edition of “Mad Money,” broadcast from the U.S. Air Force Academy in Colorado.

Johnson said the coffee giant has hired more than 26,000 veterans and military spouses, about six years after the company began its effort to do more for U.S. service members and their families.

The request came from Starbucks’ Armed Forces Network, an internal group of employees who have served in the military, Johnson said.

The unemployment rate for veterans has fallen to an all-time low in recent years. It was at 3.2% in October, according to the Department of Labor. The non-veteran jobless rate for the country was 3.5%.

The jobless rate for veterans peaked at 9.9% in 2011.

Johnson also highlighted other efforts the Seattle-based company has undertaken to improve the lives of U.S. service members and their families, such as an “adopt-a-unit” program to provide coffee to those overseas and opening stores near military bases.

Starbucks’ Military Family Stores, Johnson said, can serve as places to “create community,” provide places of employment and also help with the transition back to civilian life. He said they have 62 of those stores open currently, with plans to roughly double that number in the next few years.

Starbucks’ decision to expand mental health coverage in its insurance plans was due, in part, to the “unique needs” that some service members have, Johnson said.

“Much of this is about breaking the stigma of mental health,” he said.

Other companies that hire veterans

In addition to Starbucks, Cramer highlighted the efforts of other companies that actively work to support veterans, not only through employment but specific initiatives.

Cramer said J.P. Morgan Chase CEO Jamie Dimon has been a leader in this area. In 2011, Dimon formed a coalition with 10 other companies to create jobs for 100,000 veterans, Cramer said.

In the eight years since, 550,00 vets have been hired through the initiative, Cramer said.

J.P. Morgan has, on its own, hired 11,000 vets since 2011, in addition to having awarded 1,050 mortgage-free homes to military families, Cramer said.

“Do you think it’s a coincidence that J.P. Morgan’s the best run bank in America, with a stock that’s up more than 30% for the year? I know I don’t think so,” Cramer said.

Cramer said Home Depot employs around 35,000 veterans — about 10% of its workforce — and will have spent around $500 million by 2025 on veteran-related initiatives.

Southwest Airlines is another example, with about one in every six employees having served in the military or being a military spouse, Cramer said.

On the whole, Cramer said, often companies that hire a lot of veterans have strong stocks.

I’m glad so many companies are making major efforts to hire veterans, both because it’s the right thing to do, but much more importantly … because it’s good business,” Cramer said.

“It’s no compromise and not just some patronizing feel-good story. When you look over the firms that have made the largest commitments, their stocks tend to be fantastic performers. This is one of those rare cases when you can do well by doing good.”

Disclosure: Cramer’s charitable trust owns shares of Home Depot and J.P. Morgan Chase.

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