A Typology and Policy Landscape Analysis of State Investments in Short-term Credential Pathways
The higher education landscape is evolving rapidly, and short-term credentials — also known as microcredentials, sub-baccalaureate credentials, or non-degree credentials — are increasingly taking center stage. With the job market constantly changing, there is growing demand for these valuable certificates and micro-degrees, which can enhance individuals' career prospects and help meet the evolving demands of the modern economy.
States are quickly recognizing the importance of short-term credentials and, as a consequence, are taking steps to support the advancement of these alternative credential pathways for their residents. According to our analysis of state legislation, budgets, and publicly available data, we conservatively estimate that states have invested at least $3.81 billion in short-term credential pathways. Some states are using this money to provide tuition relief to students to make higher education more affordable and reduce student debt. Others are investing in institutions to support program development and capacity-building, ensuring they have the necessary resources to create and maintain a diverse range of short-term credential programs that meet the needs of local economies. And some states are going so far as to incorporate short-term credentials into their funding formulas, thereby providing further recognition and financial support for these programs.
However, despite the rapid proliferation in state funding for non-degree credentials, we know little about these investments. To our knowledge, there has not been a systematic cataloging or analysis of state investments in short-term credential pathways. As a result, the rapid expansion of sub-baccalaureate offerings has led to a lack of consistency and capacity at the state level to define, evaluate, and track the quality, equity, and impact of these programs. While much of the current policy discussion has focused on evaluating the value of short-term credentials in the abstract or debating whether federal funding should be extended to short-term credentials, little is known about the various components and outcomes of existing state funding for these educational pathways. This has resulted in a "wild, wild west" scenario in the short-term credential landscape, where many policy innovations have yet to catch up with the pace of change.
This analysis offers the first comprehensive classification system, or typology, of direct, sustained state funding for short-term credential programs. To create the typology we conducted an in-depth examination of all 50 U.S. states and collected an extensive dataset containing all available information from legislation, state budgets, existing research, and direct communication with state higher education leaders.
Our comprehensive scan employs both quantitative and qualitative research methods to provide a nuanced and evidence-based understanding of state investments and policies around short-term sub-baccalaureate credentials, with a particular focus on quality and equity. The purpose of these efforts is to deepen our understanding of state investments in short-term credential programs and pathways, and to identify trends or best practices. By conducting this scan, we aim to leverage this knowledge to allow state policy, investments, and practice to be guided in a more informed and effective way.
To read the full report, click here.
The information presented in this report reflects the best available data we could find through our research. It is important to note that given the lack of consistent and comprehensive data systems to track short-term credential programs at the state level, we acknowledge that we may have missed some state-funded initiatives. We invite readers to contact Stephanie Murphy at stephanie_murphy@hcmstrategists.com to report any additional initiatives that may not have been captured in this study.
