Noncredit Research Collaborative

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Many public workforce training programs lead to industry-recognized, third-party awarded credentials, but little research has been conducted on the economic benefits of these credentials in the labor market. This paper provides quasi-experimental evidence on the labor market returns to industry-recognized credentials connected to community college workforce noncredit training programs. Based on novel data that includes approximately 24,000 working-age adults enrolled in noncredit workforce training programs at the Virginia Community College System, we employ a comparative individual-level fixed effects model to estimate earnings premia net of fixed attributes and earnings time-trends. Our results indicate that earning an industry-recognized credential, on average, increases quarterly earnings by approximately $1,000 and the probability of being employed by 2.4 percentage points, although there is substantial heterogeneity in economic return across different program fields. Back-of-the-envelope calculations suggest that the earnings gains associated with the industry credential obtained through the noncredit workforce training would exceed program costs in just over half a year on average.

This report presents initial findings from a comprehensive study being undertaken to examine noncredit CTE programs offered within the Virginia Community College System (VCCS). In 2016, the Virginia legislature, through HB66, passed legislation to expand participation in community college noncredit CTE programs. These programs are commonly known in Virginia as “FastForward” programs. A key component of this initiative is an innovative funding mechanism, the New Economy Workforce Credential Grant (WCG), which is a cost-sharing pay-for-performance model (described in more detail below). The programs covered under this initiative are those that lead to an industry-recognized credential in a high-demand field; our analyses focus on this subset of eligible “FastForward programs.”