Thirty states, the District of Columbia, and Puerto Rico saw declines in the share of residents having industry certifications and college certificates with significant wage premiums. This unusual decline in short-term credentials, surfacing in Lumina Foundation’s update of A Stronger Nation today, highlights the importance of paying attention to the labor market payoff of such credentials. Short-term programs like these are often alternatives to associate and bachelor’s programs.
Working with labor economists from 2014 through 2018, Lumina decided that quality short-term credentials ought to lead to jobs paying at least 10 to 15 percent above work requiring only a high school diploma. If short-term credentials do not result in wage premiums above these thresholds, we do not count them. One of the biggest challenges we face today—and why we believe tracking credential value matters—is helping students understand which credentials lead to good jobs and which ones do not deliver.
Better-paying jobs are typical in nursing, the skilled construction trades, and IT fields, where degrees are only sometimes necessary.
Overall, the United States continues to become a better-educated country. The latest Stronger Nation data show that 54.3 percent of adults 25 to 64 years old have college degrees, certificates, and industry credentials. This share of educational attainment represents a year-over-year increase from 2021 of six-tenths of a point, continuing a pattern of year-over-year increases nationally. The 54.3 percent level is up from 37.9 percent in 2008 before Lumina developed approaches for determining which certificates and industry certifications created labor market value.
In 2022, 35 states experienced overall increases in residents’ educational attainment beyond high school. Nonetheless, 15 states saw the share of residents with valuable education or training after high school drop, according to federal data and economic estimates from 2022, the most recent available. Statewide declines in the shares of residents in these 15 states with degrees or other quality credentials ranged from one-tenth of 1 percentage point in Massachusetts, Montana, and Nebraska to 1.4 and 1.2 percentage points in Alaska and Nevada, respectively. It is not clear what this single-year decline in some states tells us.
Reasons for the most recent declines could include higher wages to mitigate labor shortages and states looking harder at the quality of non-degree credentials awarded. In the past, if we noticed a decrease in one type of credential, gains elsewhere were enough to show year-over-year growth in a state’s or territory’s overall level of education after high school. This year’s slight declines in short-term credentials represent an anomaly we plan to study further.
What matters most is whether credentials earned after high school improve people’s lives. For many people, short-term credentials offer a place to start. For others, they deliver longer-lasting benefits. In the United States, 7.8 percent of adults have short-term credentials that boost their pay by at least 10 to 15 percent; sometimes, the wage premiums are much higher. These credentials can also put people on a path to college degrees.
It is no accident that a higher share of college-educated adults moved the country forward. Degree attainment rose to 46.5 percent of adults in the United States in 2022 from 45.7 percent the year before. We believe that’s because a bachelor’s degree still confers an average of $1 million in net lifetime earnings per person beyond a high school diploma, and an associate degree holder earns $500,000 more on average.
Within the next seven years, Georgetown University’s Center on Education and the Workforce predicts that nearly 30 percent of jobs will require some college or an associate degree, and another 42 percent of positions will need someone with at least a bachelor’s degree.
We urge states to focus on helping people understand which credentials lead to family-sustaining wages and allow people to participate fully in their communities. Credentials with real value—whether degrees, certificates, or certifications—give workers straightforward ways to show employers what they know and can do. In turn, well-paying jobs and stable careers let people pursue interests and give back to their communities.
Jamie Merisotis is president and chief executive of Lumina Foundation, an independent, private foundation in Indianapolis committed to making opportunities for learning beyond high school available to all.