Do College Credentials Pay Off? The Data-Backed Answer to Degree ROI

New data reveals 88% of credentials don’t guarantee wage gains. Learn about the “credential value gap” and how to choose educational pathways that lead to economic mobility. 

Author: Javaid Siddiqi, Ph.D.

If you’re investing time, money, and hope into a degree or certification, you’re asking one critical question: Will this credential pay off?

You want to know if your hard work and nights of no sleep will lead to opportunity or stability. Will I make enough money to get by, let alone succeed?

Sadly, the answer isn’t always yes.

In recent years, state education and workforce leaders have place increasing emphasis on helping more Americans earn post-secondary credentials.

Our recent analysis at The Hunt Institute examined higher education attainment across all 50 states. We found the national rate has reached 54.3 percent, up 16 percentage points since 2009. States have invested $5.6 billion across 70 short-term credential initiatives. Thirty-two states have codified attainment targets into policy. College enrollment has nearly doubled since 1970, reaching 18 million students in Fall 2022.

These are real achievements. But there’s mounting evidence credential attainment alone doesn’t guarantee economic mobility.

Here’s the uncomfortable question state policymakers must now confront: Are we measuring the right thing?

The Value Gap

Research from the Burning Glass Institute reveals that among 1.1 million available credentials, only 12 percent deliver significant wage gains. Georgetown University’s Center on Education and the Workforce found that some credentials produce earnings barely above a high school diploma. Even prestigious providers such as Stanford’s project management certificate fail the value test, yielding no wage gain for earners.

The Department of Education’s own pilot study on expanding Pell Grant eligibility to short-term credentials found increased enrollment but no improvement in wages. We’re subsidizing completion without ensuring opportunity.

For students already facing systematic barriers, low-value credentials become a double trap: they invest time and money they can’t spare, only to find themselves still locked out of economic mobility. This is often compounded by persistent racial and gender wage gaps that further diminish credential value for communities of color and women.

Our research shows that nationally, adults with professional or graduate degrees earn a median of $86,524 annually, nearly $55,000 more than those with only a high school diploma. But these averages mask enormous variation in credential value depending on field, institution, and regional labor markets.

Shifting the Focus

The challenge we need to face is about ensuring credentials connect to real economic opportunity.

Some leaders, like Lumina Foundation, have advanced the concept of “credentials of value” — credentials that lead to good jobs, family-sustaining wages, and clear career pathways.

Recent national efforts have recognized this shift, too. The focus is moving from simple completion rates to whether credentials actually deliver economic returns—defined as wages at least 15 percent above the median for high school graduates in a given labor market.

But this needs to be translated into how states structure their education investments. If states continue measuring only completion without ensuring credentials align with labor market needs and lead to family-sustaining wages, they risk perpetuating—rather than addressing—these inequities.

What States Must Do

First, define credentials to value for your state’s economy. Rhode Island’s jobs might require different skills that Wyoming’s. States need granular labor market analysis showing which credentials actually lead to stable, well-paying jobs in their regions. This requires collaboration between workforce development boards, higher education systems, and industry leaders.

Second, fix data infrastructure to track outcomes. Most states cannot follow students from noncredit programs or third-party credential providers into the workforce. Virginia and Minnesota have demonstrated it’s possible to build integrated data systems that track not just first-job placement, but wage trajectories, job stability, and credential stacking over time. Other states should follow their lead.

Third, make outcomes data actionable for students. As the Bipartisan Policy Center highlights, publishing data isn’t enough when students—especially first-generation and adult learners—struggle to interpret it. States must invest in skilled career coaches who can help learners navigate credential options and understand which pathways lead to opportunity in their specific labor markets.

Fourth, tie public funding to proven outcomes. States should require institutions and credential providers to demonstrate that their programs lead to measurable wage gains and job stability before receiving public subsidies. This creates accountability while protecting students from predatory programs.

Finally, invest strategically in upskilling and reskilling. Meeting ambitious attainment goals means helping working adults earn credentials that genuinely advance their careers. This requires flexible, affordable pathways that recognize prior learning, accommodate work schedules, and provide wraparound support services.

What Are the Stakes?

Our research shows that 70 percent of undergraduates receive federal grant aid, and 47 percent use student loans to finance their education. For these students, many from working-class backgrounds, a credential that doesn’t deliver economic mobility can be devastating.

The question every student asks, “Will my credential be worth it?” deserves an honest answer.

States have proven they can drive enrollment and completion. The next challenge is ensuring every credential they subsidize delivers on the promise of education: stability, opportunity, and a path to economic security.

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About The Hunt Institute 

The Hunt Institute, an affiliate of the Duke University Sanford School of Public Policy, is a recognized leader in the movement to transform public education. Marshaling expertise from a nationwide partner network since its establishment in 2001, The Institute brings together people and resources that help build and nurture visionary leadership and mobilize strategic action for greater educational outcomes and student success. For more information, please visit: http://www.hunt-institute.org/