Credential-Job Misalignment in Middle Skills Occupations

Introduction

The Great Misalignment, a study by Georgetown University's Center on Education and the Workforce, offers insight into the American labor market and the sub-baccalaureate credentials held by adults across the country. In particular, their research focuses on middle-skill occupations, jobs that usually require skills earned via certifications, an associate degree, or some form of licensing rather than a bachelor's or graduate degree.

Community colleges dominate sub-baccalaureate credential provision, but these credentials are also issued by other institutions, such as for-profit cosmetology or welding schools and some four-year institutions.

Misalignment occurs when adults have sub-baccalaureate credentials that do not align with jobs available in their local area. As a result, there is a mismatch in what students train in, and what skills they need to gain employment. This creates inefficiencies for potential workers as they search for employment and for employers as they search for employees.

Benefits to Alignment

Credential-jobs alignment helps ensure a robust labor market where employees find jobs that closely align with their skills, and employers are able to spend less time and resources looking for and hiring employees. Misalignment between employees and employers produces an inefficient and weaker economy as employees do not properly match — by being over or underqualified — the expertise needed by employers.

The Georgetown authors argue that there are benefits to credential-job alignment even when students plan to transfer to a four-year institution. Currently, many community college students on transfer paths are enrolled in general degrees such an associate degree in Arts and Sciences, Business or Liberal Arts. However, the authors argue that there are three distinct benefits if these students enroll in a job-aligned program:

1. After earning a sub-baccalaureate credential aligned with job-ready skills, students can earn an income at good paying jobs while working toward a bachelor's degree.
2. Students who do not end up transferring to a four-year institution have a job-ready credential they can use to enter the workforce.
3. A relatively large number of students transfer to a four-year institution but fail to complete a bachelor's degree. When this occurs, students would have a job-ready credential to fall back on.

Reality of General Degrees

General degrees, also sometimes known as general studies, are broad and include a range of general education coursework. Students enroll in these degrees for numerous reasons ranging from a desire to complete coursework prior to transferring to a four-year institution, to meeting requirements for certain programs or certificates, or because they simply do not know what they want to study.

Many community colleges have transfer agreements with universities where after completing a set of requirements (i.e., usually an associate degree with specific coursework and maintaining a certain GPA), they are guaranteed admission into a specific university. These agreements help students by giving them an outline of courses accepted for transfer and ensuring admission into their desired university. These agreements, often called guaranteed admissions agreements (GAA), generally require a general associate degree (an Associate of Arts or Associate of Science) in order to qualify.

What does this mean in practical terms? As an example, we will use the GAA between the Virginia Community College System (VCCS) and the College of William and Mary. We will also assume that our hypothetical student currently attends Patrick & Henry Community College. The VCCS-William and Mary GAA requires that a student complete an Associate of Arts, Associate of Science, Associate of Fine Arts, or Associate of Arts and Science with at least a 3.4 GPA in order to guarantee admission. At Patrick & Henry, the following associate degree programs would qualify:

• Business Administration
• Education
• General Studies
• Health Sciences
• Science
• Social Science

A close look at these associate degree programs indicates that requirements include a host of general education courses, but they do not require many subject-specific courses. For example, the health sciences associate degree requires only a few science courses, none of which are targeted to specific fields.

There are many other associate degrees at Patrick & Henry that do not qualify for guaranteed admissions. These include fields such as:

• Business Technology
• Criminal Justice
• Nursing
• Physical Therapy Assistant
• Information Systems Technology
• Early Childhood Development

While these fields are better aligned with specific jobs, students who want to transfer to a four-year institution might not choose these degrees since they do not qualify for the GAA.

GAA programs are certainly helpful, but they do not provide a great fallback for students who do not end up with a bachelor's degree at the end of their educational journey. A new report from the Community College Research Center at Columbia University indicates that while nearly 80 percent of community college students aspire to earn a bachelor's degree, only about 33 percent ever transfer to a four-year institution, and only 16 percent earn a bachelor's degree within six years of community college entry. In these cases, people may be left with an associate degree that does not support a specific career path. As a result, people may have a hard time finding employment that aligns with the credential they hold.

Misalignment in the Fifth District

The credential-skills misalignment varies across the Fifth District, with misalignment appearing worse in Virginia than in other Fifth District states. This measure shows the percentage of sub-baccalaureate credentials in each geography that are not aligned with a specific job. In some communities, credential-job misalignment is greater than 70 percent.

So, what does the misalignment look like at the micro level? As an example, we will use Patrick and Henry counties in Virginia, served by Patrick & Henry Community College. According to the Georgetown report, there is significant credential-job misalignment across many fields. While 31.2 percent of all job openings are in blue-collar fields, only 9.1 percent of the sub-baccalaureate credentials held in the area are in these fields. Additionally, they find that 62.2 percent of all credentials held cannot be matched to a specific occupation.

How Might We Improve Alignment?

While transfer agreements between community colleges and universities are incredibly valuable, there may be ways they could be reimagined. For example, they could broaden these transfer agreements from a narrow set of general degrees with strict curriculum requirements to include more options: job-aligned degrees like accounting, early childhood education, welding, plumbing, etc. This flexibility allows students to learn skills that can lead to employment directly after an associate degree while being exposed to pathways that require a bachelor's degree. It provides students with a fallback if they decide not to transfer to a university, or if they do not complete a bachelor's degree after they transfer. Furthermore, if a student has a license in a particular field, e.g., plumbing, that license can be used in conjunction with a degree in management or finance to help them open and operate their own practice. Hence, the opportunities are endless.

Additionally, most transfer agreements are not designed to transfer directly into all majors, meaning that if a student completes all the necessary requirements to transfer from a community college or a university, the GAA limits their guaranteed admission into the college of arts and sciences. Therefore, students may still have to apply to pursue a particular degree at the university, especially in fields like business, engineering or nursing. To illustrate this example, we can use the transfer agreement between Horry-Georgetown Technical College and Coastal Carolina University in South Carolina. A student who enrolls in an associate degree program in business administration at Horry-Georgetown is guaranteed admission to Coastal Carolina if they earn an associate degree with a minimum GPA of 2.25, but they would not be directly admitted into the business school. Even though they have spent two years taking classes along the business administration track, they may not be able to major in business at Coastal Carolina in a seamless manner. These types of transfer agreements may result in the need for additional coursework, or even the need to change the area of study.

Conclusion

Skills-job alignment or misalignment can impact the efficiency of labor markets, especially at the micro level. The extent to which students in a certain area are aligned with employers' needs can influence sorting in the labor market and the incomes that workers are able to attain. A critical part of addressing the misalignment is ensuring that community colleges and universities are creating transfer paths that allow for both general education requirements and skills that align with employment. It is paramount that leaders in education, government, and businesses communicate with one another to begin tackling these issues, so everyone can reap the rewards of credentials aligning well with local employment.

Views expressed are those of the author(s) and do not necessarily reflect those of the Federal Reserve Bank of Richmond or the Federal Reserve System.