Are Workplace Credentials Worth It? Report Casts Doubt on Value

With the turbulence in the federal labor market and a pivot to skills-based hiring, more workers are thinking of changing careers or supplementing their existing skills to stand out in the workplace. 

The vehicle of choice for many: taking a course and receiving a new career credential. 

But how do job seekers figure out which credential programs are worth a buck and which are a bust? And for employers, how do they figure out what potential hires have actually learned?

A new report from center-right think tank the American Enterprise Institute (AEI) and workplace data firm Burning Glass Institute aims to break down what it calls the “Wild West” of credential programs, noting that there are over 1.1 million different credentials on offer right now– but with “minimal oversight to separate value from empty promises.” 

The researchers analyzed credentials from over 23,000 non degree certificate programs from over 2,000 institutions through the lens of wage increases, job advancement, and the ability to switch careers. 

Most Credentials Not Paying Off

The report found that just 12 percent of credential programs delivered annual wage gains of $5,000 or more. And just 18 percent received wage increases from their credentials that they were unlikely to receive otherwise.  

That means the vast majority led to minimal or no wage gains, leaving students to question whether they got bang from their buck.  

It was a similar result when it came to career switching and job advancement; the quality of the credential program mattered greatly. Earning a top credential led to a six times greater chance of finding success in a job in a field and a 17 times greater chance of being promoted. 

Uncertainty Over Why Some Programs Stand Out

Researchers point out that even programs in the same field, such as cybersecurity or data science, can have vastly different results. 

For instance, people who earned highly ranked credentials in data science saw an average salary increase of $5,500. Those who earned credentials from the bottom ranked data science credentials saw little to no earnings increases. 

And that inconsistency extended across schools and platforms too. For instance, Stanford University’s Data Science Foundations program shows a $4,200 increase in salary, while its project management program saw little to no return for graduates. 

As for reasons why, the report had some inkling. 

Theories include a lack of oversight and standards, few barriers to launching a credential, and that faculty at top schools are not familiar with emerging technology. 

One thing that is clear is that “Consumers have little guidance to help distinguish valuable credentials built around effective programming, those with rigorous and expert-developed curricula, and those that employers take seriously from shoddy programs.” 

To help shed more light, AEI and Burning Glass created a searchable website with a breakdown of the outcomes data for the thousands of non-degree credentials studied in the report. 

Certain Credentials Still Valuable

Still, the report notes that credentials can be valuable when properly vetted. 

“These top credentials can serve as effective pipelines into skilled professions, leading roughly half of earners into new jobs by equipping them with in-demand skills, and have demonstrated the power to close long-standing income gaps, particularly for historically underrepresented groups,” stated the report.