Tuesday, January 21, 2014

Alternative Credentials Can Boost Earnings

Is it time to expand our notion of what constitutes higher education? According to the Census Bureau, the answer might be yes. In a first, the Census Bureau has collected and analyzed data on Americans who hold educational credentials other than an academic degree—called "alternative credentials." These include certifications through an examination process, licenses that must be renewed periodically, and educational certificates.

The number of adults with alternative credentials is substantial. In 2012, fully 46 million Americans aged 18 or older had professional certifications or licenses (22 percent of adults) and 19 million had educational certificates (9 percent). Including these credentials in measures of educational attainment would change our understanding of who has post-secondary education. Among the 59 million Americans with no more than a high school diploma, 11.2 million have a professional certification or license. "If this alternative credential were incorporated into an expanded measure of education, these 11.2 million people might be recategorized into the 'more than high school' category, representing a shift of almost 5 percent of the adult population," explains the Census Bureau.

Do alternative credentials boost earnings? Only for workers without a bachelor's degree. Among full-time workers with a high school diploma and no alternative credentials, median monthly earnings in 2012 were $2,500 per month. For workers with an educational certificate, earnings were a higher $2,917 per month. For those with a professional certification or license, earnings were $3,053 per month. For workers with both types of alternative credentials, earnings topped out at $3,200 per month. "At low levels of regular education, there is routinely an earnings premium for a professional certification or license or an educational certificate," says the Census Bureau.

Source: Census Bureau, Measuring Alternative Educational Credentials: 2012

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