The number of industry-recognized credentials (IRCs) being earned by Ohio students is skyrocketing. Attainment tripled between 2018 and 2023, from more than 40,000 credentials earned to over 126,000. More than 19 percent of the class of 2023 earned an IRC, up from 10 percent in the class of 2022. If attainment continues to climb at this pace, more than a fourth of the class of 2024 will graduate with an IRC.
Given that credentials can boost earnings and employment, this should be good news. But not all IRCs are created equal. Some are in demand by employers and lead to well-paying jobs. Others aren’t and don’t. It’s crucial to distinguish between the two.
Unfortunately, Ohio doesn’t currently have a rigorous system for doing so. The state does assign each credential a point value between one and twelve. But point values are determined by a committee based on industry-reported demand, rather than data on workforce outcomes like wages. Employer demand matters, of course, but it shouldn’t be the only measure. And even if point values are meaningful signals of demand, those signals don’t seem to be getting through to students. Nearly 70 percent of the credentials earned by the class of 2023 were worth less than six points.
The upshot? More students are earning credentials than ever before, but according to the state’s point system, most of those credentials aren’t in high demand. Even worse, we have no way of knowing whether the students who earn any credential—whether it’s worth one point or twelve—are better off in the short or long term.
To fix this, Ohio needs to establish a standardized, data-driven framework that identifies the impact of specific credentials on workforce outcomes. State leaders must start by making some policy tweaks to improve data collection and transparency. But they also need to identify measures the state can use to determine a credential’s value.
In October, a nonprofit advocacy and research organization in Tennessee called SCORE published a multi-measure framework designed to help students, policymakers, and stakeholders understand the impact of specific credentials on workforce outcomes. Although the framework was designed for Tennessee, Ohio leaders could learn a thing or two from it. Two of the framework’s measures, in particular, should be on Ohio’s radar going forward. Let’s take a closer look.
1. Annual earnings
This measure determines whether students who obtain a credential are equipped to earn higher wages that meet cost-of-living standards, thereby ensuring they receive a return on investment from their credential. To earn one star on SCORE’s three-star scale, a credential’s median earnings,[1] measured five years after completion, must be at or above the living wage for a single adult in Tennessee ($43,196).[2] To be designated as two or three stars, minimum earnings after five years must be 140 percent ($60,474) and 180 percent ($77,753) of the cost of living, respectively.
This isn’t the only way to measure annual earnings. SCORE notes in its report that Texas determines credential impact by examining whether a credential-holder earns enough within ten years to pay for the cost of their post-secondary education and surpass the earnings of a typical high school graduate. Either of these measures could work in Ohio, provided they’re calculated according to the distinct costs of living and obtaining an education here. State leaders could also establish a unique measure—perhaps one that takes into account cost of living according to Ohio’s seven geographic regions rather than a statewide average.
Regardless of how it’s done, linking credentials to wages would be a step in the right direction. Ohio’s Department of Job and Family Services already offers data search tools that outline wages by occupation and industry. It’s time to include credentials, too. Students deserve to know the wages they can expect before they invest time and effort to earn a credential. School counselors and educators need access to that information so they can provide meaningful career advising. And state leaders need to ensure that state policy focuses incentives on credentials that lead to better earnings for students.
2. Job outlook
This measure ensures that a credential is aligned to the skills and knowledge required for job opportunities. Between 2020 and 2030, Tennessee’s projected annual job growth rate is 1.6 percent.[3] SCORE used that number to set the threshold for its highest tier. Three stars means that a credential’s aligned job demand will annually grow by the state average from 2020 to 2030. A two-star designation represents aligned job demand growth of 1.2 percent, while a one-star designation represents aligned job demand growth of 0.8 percent.
Ohio officials could make a similar calculation regarding projected annual job demand in the Buckeye State and then link that demand to jobs aligned with each credential. Industry leaders, especially those who are part of the committee that currently determines the point value of a credential, should still be involved. In fact, it might be wise to have two measures for identifying job outlook—one that focuses on short-term demand according to feedback from industry partners and a second that considers long-term job outlook based on projected data.
One of the drawbacks of SCORE’s job outlook measure is that it doesn’t take into consideration regional and local demand. That’s not going to work here, as JobsOhio heavily emphasizes the state’s seven geographic regions. It wouldn’t make sense for the state, which has invested so much in regional data tracking, to limit job outlook measures for credentials to only statewide projections. To solve this problem, leaders should look to Ohio’s school report cards for a solution. Just as the state disaggregates proficiency data by school, subject, and grade level, it could disaggregate job outlook according to state, regional, and local demand.
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Identifying the value of an industry-recognized credential is tricky work, as there will always be anecdotes arguing for or against each one. But anecdotes shouldn’t drive policy, and there are some measures of quality that are important enough to be non-negotiable. One of those measures is annual earnings. If a credential doesn’t ensure that a student is financially better off for having earned it, then it shouldn’t be considered valuable by the state. Another is job outlook. Data that tracks projected job growth over time and across regions is just as important as feedback from industry partners. Given the rapid rise in credential attainment by high schoolers over the last few years, Ohio leaders need to get serious about identifying IRC value. Linking credentials to measures of annual earnings and job outlook is a great place to start.
[1] Tennessee’s statewide longitudinal data system links earnings to credentials and degrees when students enter the workforce but does not link these earnings to the specific jobs that students obtain.
[2] SCORE notes that the Massachusetts Institute of Technology used data on common living expenses to identify the cost of living in Tennessee.
