A ‘Great Misalignment’ Between Credentials and Jobs

A new report from the Georgetown Center on Education and the Workforce found a “great misalignment” between projected job demand in many local labor markets and the mix of credentials available to workers seeking jobs requiring more than a high school diploma but less than a bachelor’s degree.

The report, released on Wednesday, focuses on “middle-skills credentials,” which include sub-baccalaureate certificates and associate degrees, in 565 local labor markets across the country. It noted that, as of the 2020–2021 academic year, there were nearly 4,800 providers of these kinds of credentials, including community colleges, nonprofit and for-profit colleges, private work training organizations, and technical and cosmetology schools.

In the coming years, these providers will be tasked with training a lot of workers in the right industries, and in the right geographic areas, to sufficiently fill local workforce gaps—and they have a long way to go, according to the report.

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The report highlighted that of the 18.5 million annual job openings projected nationwide through 2031, about 31 percent or 5.8 million of them are expected to go to workers with an associate degree, certificate or some college credit but no degree. (Half of those roles are projected to be in blue-collar jobs, sales and office support, and half are expected to be in fields that include food and personal services, education, healthcare and STEM jobs.) The report found that in 283 of the 565 local labor markets studied, at least half of middle-skills credentials would have to be offered in different fields than currently offered to satisfy projected job demand.

Co-author Zack Mabel, director of research at the Georgetown center, said no one expected there to be perfect alignment but “the raw extent to which we found local labor markets to be misaligned was startling.”

He noted that when credential providers in a local labor market aren’t collectively aligning with workforce demand, students can suffer consequences. Some graduates might have to take jobs outside the fields they studied or leave the region altogether in search of work, contributing to regional “brain drain.” Others might gravitate toward programs in seemingly lucrative fields only to find there’s an “oversupply” of workers vying for too few openings, and as a result, a “downward pressure” on wages.

Jeannine LaPrad, managing director of policy and research at the National Skills Coalition, a research and advocacy organization focused on workforce training, said these misalignments could have major consequences for higher ed institutions, not just community colleges but regional four-year universities, as well, as they try to keep enrollments up.

“Their future, their livelihood depends a lot on how aligned they are with their local regional labor market,” she said. Offering nondegree credentials in high-demand fields satisfies employers but “also lines up with what students are looking for and why, which is access to a broad array of credentials and pathways that will help them get a livable wage.”

Mabel noted that alignment alone doesn’t address whether jobs pay well. For example, there are substantial projected openings in sales and office supports positions, but those might not be the jobs that offer the most return on investment.

Still, “alignment is a really, really helpful framework for understanding where the opportunities to expand economic opportunity lie,” he said.

The report noted that one cause of misalignment is a significant subset of credentials are offered in disciplines that don’t directly lead to a career path. It found that 28 percent of all middle-skills credentials were awarded in programs “with no direct occupational match,” such as the liberal arts, humanities or general studies.

The report stressed that these kinds of programs can still have value “in the marketplace or to individuals” who pursue them for a range of reasons including to help with “transfer to a four-year institution, personal edification, or personal interests and values.”

“At the same time, middle-skills programs can better serve students by strengthening pathways to both four-year programs and the workforce,” the report read.

Charlotte Cahill, associate vice president for education at Jobs for the Future, an organization focused on helping college and workforce leaders create equitable economic outcomes for students, said while it might be tempting to colleges to launch all kinds of shorter-term credentials, the report’s results suggest it pays off to be strategic in which they offer.

“I think part of what this report is really pushing on is this idea that, in fact, rate demand for credentials varies by industry,” she said. “And so on the higher ed side, it makes sense to get really clear about where are the industries? Where there is demand for credentials … how can we design programs of study that are really sort of backwards mapped from what employers are looking for?”

LaPrad added that ensuring that credentials not only align with open jobs but prepare workers well for those jobs is important, noting that a number of states have been developing frameworks for assessing nondegree credential quality.

“I think that it’s important to also be looking at this quality issue alongside just looking at alignment,” she said.

Disparities in Alignment

The severity of misalignment between credentials and future jobs varied depending on various factors in the local labor market. Urban areas were generally found to be better aligned than their rural counterparts because these regions tend to have more credential providers nearby, and as a result, more access to a range of credential programs, the report suggested. Notably, very rural areas had only two credential providers on average, compared to very urban areas, which had 26 providers on average. The report asserted that “complementarity,” different credential providers prioritizing different parts of the labor market, partly explains why having many credential providers can strengthen alignment. A mix of different kinds of credential providers also helps with alignment.

For example, in Michigan, the 51 credential providers in the Detroit area would need to offer 44 percent of middle-skills credentials in different fields to reach perfect alignment, while the one college serving Charlevoix, Cheboygan, and Emmet Counties, North Central Michigan College, would need to adjust nearly two-thirds of its credential options.

Mabel said in areas with only one or two credential providers, it’s particularly important that providers collaborate with local employers to tailor credentials to their needs, provide work-based learning opportunities to further prepare students for the workforce and provide career counselors who can guide them through employment data, like what jobs are projected to be in-demand when they graduate and what their expected salary would be.

“We are very, very information rich right now” when it comes to labor market data, but “we are very infrastructure poor when it comes to proactively providing students with the type of career counseling that they really desperately need in the increasingly complex labor market that we have today,” he said.

The report also uncovered some racial disparities in access to middle-skills credentials in high-demand jobs and well-aligned labor markets.

For example, American Indian and Alaska Native working-age adults, ages 18 to 65, were three to 18 times more likely to live in an area with no middle-skills credential providers within commuting distance by car, compared to other racial and ethnic groups. However, 71 percent of American Indian and Alaska Native adults who do live near credential providers live in areas with fairly strong credentials-to-jobs alignment. The majority of Black adults, 75 percent, also live in labor markets with relatively strong alignment, while only 58 percent of Latino or Hispanic adults live in these kinds of areas.

Mabel described these disparities as “a reflection of the geography of opportunity.”

While the data he and his co-authors analyzed doesn’t directly address why these racial gaps exist, “the reality is that we know there is a lot of geographic stratification by race and ethnicity in our country,” he said, which “overlaps with the variation in alignment that we see across local economies.”

The report includes a series of recommendations to credential providers and policymakers to create better credentials-to-jobs alignment, including institutions coordinating to meet different labor market needs, federal lawmakers increasing funding to workforce education and state governments collecting more fine-tuned regional jobs data and funding colleges to better analyze and apply it.

Mabel sees the report as a “starting point” for local credential providers, employers and workforce development professionals to look at the nuances of misalignment in their own communities.

The goal is to “try to encourage folks with much, much more on-the-ground knowledge, information and expertise, to take what we’ve done, personalize it for themselves, and ask the really difficult questions about what can we do about this?” he said. “Where are the leverage points in our particular community to start to make progress towards creating stronger relationships between our education and workforce systems?”