A new project backed by the Lumina Foundation seeks to help 12 states better gauge the value of short-term credentials, with a plan to create a set of principles that could be used by other states and the federal government.
With an initial investment of roughly $2.2M from Lumina and an 18-month timeline, the FutureReady States initiative will support five intermediary organizations in offering states a mix of technical assistance and policy guidance.
Participating states are a mix of red and blue, including Alabama, Colorado, Connecticut, Illinois, Louisiana, Michigan, Mississippi, New Jersey, North Carolina, Tennessee, Texas, and Virginia. The partner groups are the Business–Higher Education Forum, the Century Foundation, Education Strategy Group, Jobs for the Future, and the National Skills Coalition.
State funding for workforce credential programs has increased rapidly, with 31 states investing at least $5.6B in them last year, according to an analysis from HCM. But a firm grasp of the ROI of these credentials remains elusive, as are answers to questions about how well matched they are to the needs of employers.
“We haven’t invested as much in learning about the strengths and weaknesses of short-term workforce programs,” says Kermit Kaleba, Lumina’s strategy director for employer-aligned programs. “There are limitations on our understanding of which credentials lead to good labor market returns.”
Employer engagement and participation will be a key focus of the work. And Kaleba says the foundation is reviewing research proposals on barriers employers face in more effectively using short-term credentials in hiring and promotion.
The project will not prescribe a particular approach, say Lumina and reps from the five intermediary groups. That flexibility means it’s unclear what takeaways might emerge. And making progress on the data front won’t be easy.
Questions to Explore: The state-level strategy is encouraging, says Maria Cormier, a senior research associate at the Community College Research Center at Columbia University’s Teachers College. And she says the project could help tackle several urgent questions beyond vexing ones on data.
For example, states bring a variety of approaches to how they fund short-term credentials, Cormier notes. Some, like Virginia and Colorado, provide direct aid to students. Texas and North Carolina incentivize community colleges to offer short-term credentials in high-demand fields. Other states, however, encourage colleges to create those programs without providing any new dedicated funding.
“What type of financial incentive from the state generates better value?” asks Cormier, adding that the initiative could create “opportunities to compare apples and oranges.”
Questions about implementation and scaling also are pressing, she says. So are a myriad of tough trade-offs states and colleges must make to offer more workforce credentials. For example, is a welding program that enrolls five students worth keeping amid moves by some states to force colleges to cut low-enrolled programs, even if employers are calling for that training?
“What’s of value to the institution? What’s of value to the student?” asks Cormier. “Who gets to determine what’s valuable? Is it just the labor market and employment outcomes?”
State policymakers have been clamoring for those answers. And experts say the Trump administration’s cuts to federal education research contracts aren’t helping.
For example, Virginia’s G3 program is among the highest-profile and most established state strategies to subsidize workforce-aligned short-term training. Cormier was leading a partnership with the University of Pennsylvania and the Virginia Community College System to conduct a three-year study of G3’s role in expanding access to high-demand jobs.
The research yielded a brief this month. But the Education Department’s deep slashing of research grants nixed the G3 study, one year before it could be completed with a full evaluation. (It’s not too late to resuscitate that work with philanthropic support.)
Cormier hopes the Lumina-funded project can help connect some dots on short-term education and training. The overarching goal, says Kaleba, is better investment of taxpayer dollars.
The Kicker: “We’re not maximizing the value of these credentials for workers, for businesses, and for the broader public,” he says. “We’ve got to do better.”