New NSC issue brief on making Pell Grants more job-driven

July 20, 2015

As U.S. labor market demand for skilled workers increases, more people are turning to career-oriented postsecondary education to prepare them with the skills they need to obtain employment or increase their earnings. Certificate programs in particular have become the fastest-growing postsecondary credential, making up a quarter of all postsecondary awards, compared to just six percent a generation ago. Despite growing demand, career-oriented postsecondary programs – short-term and noncredit programs in particular – are in many cases, ineligible for federal financial aid.

National Skills Coalition’s new issue brief, Making Pell Work: How America’s $30 Billion Investment in Need-Based College Aid Can Be More Job-Driven, examines the growth of short-term and noncredit career-oriented programs and the role they play in both postsecondary education and in the U.S. economy, and offers recommendations to policymakers on how to make these programs more accessible to working learners and to employers seeking to sustain or grow their businesses:

  • Make short-term occupational certificate programs eligible for Pell Grants
  • Consider making demand-driven noncredit programs eligible for Pell
  • Use sector partnerships to help ensure that short-term and noncredit programs are demand-driven 

U.S. businesses have increasingly come to rely on career-oriented postsecondary programs that equip workers with a specific set of occupational skills. For workers, career-oriented programs offer an efficient way to obtain and document the essential skills they need to do the job they are ultimately seeking at the end of their training. While postsecondary institutions are striving to meet the demand for short-term and noncredit occupational programs, many of the programs they offer are not eligible for federal financial aid, including Pell grants, the largest federal source of need-based financial aid.

Preparing individuals with specific skills and credentials that are in-demand by employers is now a core function of the postsecondary system. At the same time, federal financial aid policy often doesn’t recognize short-term and noncredit career-oriented programs as part of the mission of postsecondary institutions. For low-income and working students who depend on Pell Grants and student loans to finance their education, current policy effectively creates a barrier to access for this particular type of postsecondary education. While community colleges and other postsecondary institutions are becoming more responsive to the labor market, federal financial aid is not.

This issue is particularly relevant now, given that policymakers on Capitol Hill are currently working to reauthorize the Higher Education Act (HEA), which authorizes Pell Grants and most other federal investments in postsecondary education. As Congress moves forward with HEA reauthorization, National Skills Coalition will urge policymakers to update Pell to reflect both the changing role of postsecondary education and the changing needs of the labor market.