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There are currently more than ten million job openings in the United States. But as the economy evolves, workers’ skills don’t always match the needs of the labor market. People in need of employment may not have the time or resources to go back to school for years to prepare for those new jobs.
Moreover, as a Wall Street Journal survey found this week, Americans are losing confidence that a four-year college degree will yield a large enough return to justify its cost. Recent graduates report that that traditional higher education doesn’t adequately prepare them for the workforce. Most Americans say they want alternatives to four-year college.
A new report from Harvard University’s Project on the Workforce shines a light on an oft-neglected avenue for career preparation: the workforce training system. The authors examine job training programs funded under the federal Workforce Innovation and Opportunity Act (WIOA). There are tens of thousands of WIOA-eligible programs that could theoretically prepare workers for the jobs of tomorrow.
However, the workforce training system receives only a sliver of the federal funding allocated to traditional higher education. Moreover, many WIOA-funded programs operate out of traditional colleges, raising doubts that workforce training operates as a true alternative to traditional higher education. While some postsecondary alternatives like apprenticeships have great promise, the American job-training system remains underutilized, and often ineffective.
The landscape of federal workforce training
While WIOA has a broad purview, the authors of the Harvard report focus specifically on two WIOA programs with a “training mandate for adults:” the Adult and Dislocated Worker programs. These supply funding to individuals who qualify for job-training assistance; individuals may use this funding for any approved training program. While WIOA is a federal law, it is state governments’ responsibility to maintain lists of eligible training providers, which are then presented to prospective trainees via state websites.
In program year 2019, the two WIOA programs analyzed supplied $427 million in training funds to approximately 220,000 individuals, or just
To qualify for job training funds, individuals must be experiencing economic hardship and exhaust other funding sources for which they are eligible (such as Pell Grants), among other requirements. Prospective trainees must meet with an approved career counselor, who ensures they satisfy these criteria. While these hurdles are in place to ensure WIOA’s limited funding goes to the neediest individuals, they also contrast with the relative ease of accessing federal student aid funding at traditional colleges, which operates like an entitlement.
As of 2019, there were roughly 75,000 programs eligible for WIOA funding, offered by 7,000 different organizations. Most programs are tiny—the average program enrolled just three WIOA-funded learners in that year (though some programs may enroll students funded by other means).
In addition, 49% of programs were offered by traditional institutions of higher education. Around 12,000 programs led to an associate degree and 10,000 led to a community college certificate. These programs would qualify for federal student aid in addition to WIOA funding. “In general,” the authors write, “WIOA dollars tend to go toward classroom learning environments rather than work-based learning environments.” Viewed in this context, WIOA programs seem less an alternative to traditional higher education, and more an additional source of college aid.
Just 1% of the WIOA-eligible programs the authors identify are apprenticeships. Apprenticeships tend to deliver high earnings, charge lower tuition (if any), and pay wages while students complete them. While there are over 25,000 active apprenticeship programs registered with the Department of Labor, only a fraction of those receive workforce training funding under WIOA. Though there are other programs to support registered apprenticeships, these sources of funding are also limited and irregular.
The jobs WIOA prepares for
With 75,000 different options, it is unsurprising that the occupational focus of WIOA-funded job training programs is varied. The most common occupational focus—medical assisting—accounts for just 3% of WIOA programs. Many of the jobs which WIOA programs train for do not require a college degree, including metalworkers and HVAC technicians. However, some occupations which benefit from WIOA dollars, including computer and information systems managers, do typically require a college degree for entry-level workers.
The authors raise concerns about whether WIOA programs deliver a return on investment for their participants. Six to nine months after program completion, participants earned a median wage of $29,388. This compares unfavorably with median earnings for all high school graduates without a college degree ($38,792).
WIOA participants may have the opportunity to grow their earnings, though. Individuals new to an industry tend to earn less at first, but see their wages rise as they gain more experience. For instance, WIOA-funded participants in metalworking programs earned $22,981 in the first twelve months after completing their programs. But median wages for all workers in these occupations are $44,910—nearly double the wages of entry-level workers.
Most WIOA programs prepare individuals for occupations that will experience at least some demand growth over the coming years (a requirement for programs receiving WIOA funding). However, only three of the top ten programs train participants for occupations expected to grow faster than the average. There may be unrealized potential to prepare workers for the job market of ten years for now.
WIOA appears to have a number of blind spots among occupations that typically don’t require a bachelor’s degree, but which are expected to grow rapidly. “There are fewer than five approved programs nationally that train for derrick and rotary drill operator roles for oil and gas, for forest fire inspector and prevention specialists, or for hearing aid specialists,” the authors write. It’s possible that the limited funding available under WIOA precludes providers from offering the more intensive training needed for certain high-demand jobs that require specialized skills.
Improving workforce training
While the federal government supplies funding for WIOA, programs are approved and marketed to workers by states. Unfortunately, like so many government websites, states’ online lists of approved programs are clunky and difficult to understand.
The websites that host these lists are often “poorly-designed, infrequently updated, and hard to use,” the authors note. “Digital interfaces vary substantially across states in accessibility and sophistication, and bugs were common.” In some states, the “list of eligible programs” is little more than a downloadable PDF, with no capacity to search or filter for particular jobs. Many lists lack important information like expected earnings, or present these statistics in a confusing way.
Cleaning up the state eligible program lists would help. But funding is also an issue. WIOA supplied less than $2,000 per participant in 2019. It should be obvious that the government has its thumb on the scales in favor of traditional higher education, which enjoys hundreds of billions of dollars in annual subsidies from federal and state governments. While WIOA funded 220,000 participants in 2019, federally-subsidized colleges and universities enrolled 20 million students in the same year.
It is unsurprising that WIOA dollars, despite being earmarked for workforce training, often flow to classroom-based programs offered by traditional colleges. When they use their WIOA dollars at a traditional college, participants can stack their funding with other sources of aid, like Pell Grants. True work-based alternatives to college, such as apprenticeships, get only a sliver of the funding allocated to traditional higher education.
The answer is not necessarily a massive increase in overall funding for education and job training. Rather, policymakers should ensure that all postsecondary options operate on a level playing field. While funding for higher education operates as an entitlement, funding for workforce training is limited and only available after prospective participants satisfy many conditions.
Options for policymakers
Remedying this problem does not require a big new government program for workforce training. By contrast, existing programs should be made more compatible with the goal of providing workers with quick, accessible, work-based training programs to prepare them for the jobs of tomorrow.
There are several options. Policymakers could allow Pell Grant funding to support high-quality short-term educational programs, as House Republicans recently proposed. The Education Department could also allow apprenticeships to count as eligible programs for the purposes of student aid eligibility, which would enable apprentices to use Pell Grants to pay for any classroom components of their programs. The federal work-study program, which subsidizes the wages of students who work while enrolled in college, could also be reformed to better support work-based learning. While more types of programs should be eligible for federal subsidies, Congress should also ensure that funding flows to programs that deliver satisfactory economic outcomes relative to their cost.
Workers trying to get a leg up in the labor market need options outside of traditional higher education. Unfortunately, America’s existing workforce-training system is living in the shadow of far larger funding streams for traditional colleges and universities. As Americans increasingly question whether four-year college degree is worth the time and expense, policymakers should ensure that alternatives are adequately supported.
