Outcomes for Students
The United States education system has faced criticism for not properly equipping students with the skills needed to become financially stable in the job market. Since the COVID-19 pandemic, the disconnect between education and employability has become even more pronounced. Many attribute the unprecedented labor shortages, which continue to plague the workforce, to a lack of skilled talent needed to maintain public and private sectors.
A 2021 report on graduate employability surveyed Americans who graduated from a two-year or four-year college in the previous five years. The survey found that nearly 1 in 5 (19%) reported that their college education experience did not provide them with the skills needed to perform their first post-degree job. Job candidates reported feeling underqualified and ill equipped for the skills and capabilities required for jobs. Nondegree credentials have the potential to fill the gaps in traditional four-year degrees and offer students a valuable alternative.
Nondegree credentials can generate sizable returns, especially when stacked on top of associate and bachelor’s degrees. A Strada report on the outcomes of nondegree credentials evaluated the prevalence, quality and value of nondegree credentials by length of program, field of study, provider, gender, race/ethnicity, parents’ education, and generation. The results demonstrate that students are satisfied with their experiences in nondegree pathways, with 65% of those who completed nondegree programs saying their education was worth the cost, and 49% saying it helped them achieve their goals.
Stackable credentials are programs that are part of larger sequences of credentials that can be aligned through pathways to lead to further education or a career. The Strada survey found that 70% of those who had both an associate degree and a nondegree credential said their education made them an attractive job candidate, compared with 43% of associate degree holders without a nondegree credential.
The value of a credential also depends on the wages it allows workers to earn. Adults with both associate degrees and nondegree credentials have reported earnings of $50,000 annually. While that reported salary is lower than that of an average worker with a bachelor’s degree or higher ($75,000), it represents a significant jump above the earnings of high school graduates ($32,000). These outcomes can be available for future workers if policymakers are intentional in promoting and providing credentials for jobs that are in demand and high paying.
State Legislative Examples
Louisiana’s Board of Regents created a Higher Education Master Plan to provide a broad vision for the state’s higher education system, increase educational attainment and make investments toward better lives for Louisiana citizens. The one-year review of the plan stipulated that nonacademic credentials of value will be counted toward the state’s attainment goal. Credentials of value must meet the following five standards:
- Provide valid, reliable and transparent evidence of the competencies mastered and conferred by an entity recognized by business and industry and/or the state of Louisiana.
- Align to an occupation with a three-, four- or five-star rating as defined by the Louisiana Workforce Commission based on job demand, projected job growth and earnings.
- Lead to an occupation with a 20% wage premium over a high school diploma in Louisiana.
- Provide evidence for employment and wage outcomes.
- Meet these criteria as a stand-alone credential, independent of another credential.
Indiana passed SB 198, or the Workforce Ready Grant, in 2017. The legislation allowed residents who have earned a high school diploma, but not a postsecondary degree, to enroll in no-cost training programs in certain high-demand fields. The grants may be used only for 125 high-value certificate programs in advanced manufacturing, building and construction, health and life sciences, IT and business technology, and transportation and logistics. Through the passage and maintenance of the bill, Indiana has demonstrated its intention to promote high-demand jobs and set students up for positive outcomes.