Putting the Pell Grant to work—in the workforce
Earlier this year, the U.S. House of Representatives passed the America COMPETES Act, a broad economic legislative package aimed at boosting the country’s economic competitiveness on the world stage. The legislation includes a provision that would make an important — and overdue — change in how we help working learners finance their education: by expanding the federal Pell Grant program to cover qualified short-term programs.
The Pell Grant has been the cornerstone of federal financial aid for nearly six decades, providing an economic lifeline to 7 million students and widening access to higher education for learners from diverse and underserved backgrounds. About one-third of U.S. undergraduates, including nearly 60 percent of Black students and about half of Latinx students, rely on Pell to pay for college.
But as a program, Pell has not consistently kept pace with the evolving demands of the labor market and the needs of today’s students, vastly limiting the kinds of education and training options learners can access.
By welcoming short-term Pell, policymakers are at last beginning to understand the need for rapid skill-building strategies if the United States is to remain competitive. They have an opportunity to modernize our education and workforce systems by expanding the use of Pell Grants to programs that provide a faster pathway to higher wages and stable careers.
While the economic benefits of college access and completion are often profound and long-lasting, persistence rates remain startlingly low and student debt is soaring. There are more than 36 million U.S. adults with some college and no degree, with about 40 percent of students who take out loans not earning a degree within six years.
Meanwhile, so-called “middle-skill jobs”—which require more than a high school diploma, but less than a four-year college degree—are the largest segment of the U.S. labor market. According to the Georgetown Center for Education and the Workforce, there are 16 million “good jobs” for workers trained to the middle-skill level.
Employers are facing a shortage of skilled labor that is blunting America’s economic competitiveness. More than 8 million workers in the U.S. remain unemployed even as nearly 11 million job openings await skilled workers. Working adults cannot always afford to invest time and money into years of training and education. The economy needs job-ready workers today.
Americans are starting to look beyond traditional higher education for solutions, and they are finding it in a growing number of more affordable, flexible, and accelerated learning options that allow them to quickly gain the skills they need for higher-paying, in-demand jobs.
Yet, federal policy has done little to embrace short-term credentials. There are valid concerns around the quality and accountability of these programs—and the potential that they may lead students to low-wage career tracks. This view fails to take into account that there are already millions of Americans with college degrees working in fields that do not require them.
Indeed, many short-term options lead not only to higher wages but also pathways to earning a degree. For example, Virginia’s FastForward program provides short-term training through the Virginia Community College System (VCCS) for a population of Virginians that the community college system has long had difficulty serving—working adults without college degrees.
With an average age of 36, two-thirds of FastForward students have no prior college experience and about 40 percent are students of color. They’re also twice as likely as degree-seeking students to receive Temporary Assistance for Needy Families or federal nutrition benefits through the SNAP program. Today, 93 percent of FastForward enrollees have earned a credential, with those who finish seeing a 24 percent average increase in wages.
A growing body of research on short-term credentials is showing they pay off. A study conducted by Old Dominion University — as well as a Community College Research Center report focused on strategies for improving postsecondary attainment for Black, Hispanic and Native American adults — found strong outcomes for students in these programs.
Community college leaders, including the American Association of Community Colleges, have taken note and extended their full support for expanding the Pell Grant to include the sort of short-term, workforce-relevant options that their students want.
As we consider creating pathways to public funding for workforce programs through short-term Pell, we also need effective guardrails and consumer protections to ensure that these education and training investments flow to programs that produce real results. We must establish criteria that allow for these short-form workforce training programs to meet the real-time needs of the labor market. For example, the Educational Quality Outcomes Standards Board is creating a framework that such programs can use to demonstrate their quality to policymakers, employers and students.
Program performance should be measured through student outcomes, such as program completion, future employment, earnings, and other metrics that ensure a strong return on investment for students. It’s critical that programs funded through short-term Pell connect to stackable credentials and pathways that can lead to higher wages—without foreclosing on the possibility of degree completion.
Short-term credential programs can offer immense value in helping people reach the next rung on the ladder to long-term economic prosperity. The same programs that have expanded access to higher education should be expanded to support new models—including online education and training, competency-based education, and stackable credentials—that reflect the complex needs and realities of today’s students and employers.
As the boundaries between higher education and workforce development continue to blur, it’s time to expand federal financial aid to include these high-quality short-term credentials. By expanding access to options that are responsive to the needs of learners and the workforce, we can ensure America’s job seekers can compete in the economy of today and tomorrow.
Maria K. Flynn is a former Department of Labor executive who served during the administrations of President Bill Clinton and President George W. Bush, and today serves as the president and CEO of Jobs for the Future, a national education and workforce nonprofit. Jeremy Wheaton is the president and CEO of ECMC Group, a nonprofit that invests in philanthropic efforts and nonprofit programs focused on student success and financial literacy.
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