Short-term credentials are popular, in part, because they promise to be a springboard for the working poor: First, to a better job. Then, to additional education.
They’re a good start.
Lindsay Daugherty and her colleagues at RAND Corporation have been at the bleeding edge of understanding whether those credentials actually deliver on that promise. Their earlier research found that learners did see wage gains from completing certificates—of about 16%, on average—and that those who stacked credentials saw more than twice that bump. (Other research has found strong, but more modest gains for layering credentials.)
But they didn’t tease apart how low-income learners, in particular, fared. So for their latest study, they teamed up with researchers at the University of Michigan to use new data from Ohio and Colorado to look specifically at that.
- In both states, at least half of low-income students who completed certificates ended up with middle-class wages within three years.
- And about 4 in 10—39% in Colorado and 43% in Ohio—stacked credentials.
Low-income students, defined as those earning at or below 200% of the federal poverty line before completing their certificate, were somewhat more likely to stack credentials than their middle- and high-income peers.
“The fact that low-income certificate-earners stack, and stack vertically, at higher rates is great news, as our prior was to expect lower rates of stacking,” say Daugherty and two of her co-authors at Michigan, Peter Bahr and Jennifer May-Trifiletti.
But, Daugherty cautions, these results were for learners who had completed a certificate, so not every low-income student who starts a short-term program is going to have those same odds.
The biggest determinant of whether a certificate completer would continue on to earn another credential was whether they started out in a for-credit or non-credit program. Low-income students who earned non-credit certificates very rarely went on to stack another credential.
Field of study also mattered a lot, with fields like IT, education, and manufacturing and engineering seeing high rates of credential stacking.
Stacking Up Pays Off
Stacking credentials tended to pay off, with a major caveat: only if the certificate was stacked with a higher-level credential. For example, a student might earn a short-term certificate in IT and then go on to complete a longer-form one focused on a more advanced skillset. Or they might earn a certificate in licensed practical nursing and then go on for an associate degree.
About 58% of low-income learners who stacked credentials in Colorado and 65% in Ohio added on a higher-level credential, what the researchers call “vertical stacking.”
But that means about 4 in 10 learners in each state didn’t. Those completers instead stacked credentials “horizontally,” adding on another certificate at the same level but with a different skill focus. They saw no additional wage bump.
That should make institutions think more deeply, the authors say. “We would certainly advise institutions to look closely at their horizontal stacking pathways and consider whether they offer value to students in terms of career growth and critical skill development,” they say.
Field matters: But here again, the field the student is in matters a lot. IT and mechanics both had high rates of learners stacking multiple certificates together—and in those fields that seemed to pay off more often. Earnings may also not be the only economic value, the authors say.
“There are cases where horizontal stacking may keep people employed without contributing to earnings growth,” Daugherty says.
Michelle Van Noy, director of the Education and Employment Research Center at Rutgers and an expert on short-term credentials, agrees that institutions and policymakers should pay close attention to how stacking credentials pays off in different fields.
“The variation by field is important, and may help shed light on when horizontal or vertical stacking are each valuable,” she says.
Making sense of all this—and acting on it—can be a real challenge for learners. The new research, for example, found that while stacking credentials in allied health and nursing tended to pay off, relatively low numbers of low-income students did so. And low-income students are heavily represented in those fields.
Other fields, like education and culinary, have high concentrations of low-income learners but low economic returns—even if certificate completers layer on a higher-level credential.
“Stackable credentials should serve as a ladder of mobility. But they often function more as a jungle gym…,” says Shalin Jyotishi, a fellow at New America and senior program manager at Burning Glass Institute, which is studying how different combinations of credentials fare in the labor market. “Some stackable pathways lead to better jobs, better wages, and a return on investment while others lead to unemployment, underemployment, or employment in jobs that don’t provide a local living wage.”
The new analysis, he says, offers invaluable insights. “The more research we have on what is leading to desirable outcomes, the better off we will be.”