The Short-Term Credential Landscape & AI’s Impact

Paul Fain, Journalist and Founder of Workshift.org, joins us to discuss the short-term credentialing landscape, how we measure ROI, and the potential impacts of AI on learners and the higher education ecosystem.

Transcript

Matt Sterenberg (00:01.27)
All right, Paul, welcome to the podcast.

Paul Fain (00:04.15)
Thanks, Matt. Appreciate you having me.

Matt Sterenberg (00:06.818)
So you are a journalist and you’re doing some really cool things with Workshift. Tell us a little bit more about how you got to do this work, what Workshift is and the areas of focus for Workshift.

Paul Fain (00:20.31)
Yeah, yeah, I appreciate that question. So I was a long time journalist covering higher education for about a decade at Inside Higher Ed and before that at the Chronicle of Higher Education. And for most of that time was focused on lower income learners, policy, and community colleges. The kind of core of the beats I oversaw are.

myself. And I always thought it would be great if you could do a wider lens on workforce, you know, go into K-12, go into corporate training and the connections between all those spheres. It’s hard to do, hard to build a business model around a publication that isn’t kind of industry specific. But in the peak of the pandemic, I decided to give it a whirl. And, you know, my colleagues at Inside Higher Ed and I, you didn’t have to be

to know that this is where a lot of the action is. This is a very busy beat. But the real challenge was kind of building an audience and a revenue model in a space that’s just focused on lower income learners and frontline workers.

Matt Sterenberg (01:32.13)
Well, I thought you were a perfect person to have on this podcast. We focus on credential innovation, learner pathways. A lot of our discussions have been on how do credentials lead to opportunity? How do we measure that? What are the pathways that learners need to take for their next educational or professional opportunity? So I think you’re a great person to have on. This is a big question, Paul, but what are the big questions that the ecosystem has to answer?

What are we trying to answer? Like there’s some big questions around credentialing, opportunity, how we make those connections. In your mind from what you’ve been hearing, what are some of the big questions that are outstanding for this higher ed to workforce area?

Paul Fain (02:17.558)
Yeah, I mean, the biggest one obviously is how do we measure value of non-degree credentials? I think that’s the multi-billion dollar question. They’re pretty hot right now. I think a lot of folks are…

Obviously, there’s questions about the four-year degree. I don’t like to talk about the non-degree space in opposition to that. I think for a lot of folks who are interested in pursuing short-term certificates, certifications, etc., it’s not like they’re choosing between that and a four-year degree at a residential college. It’s either that or nothing or another short-term credential. But there are a lot of them out there. There’s a very wide range of uptake from employers.

super hard for states and the feds to measure the sort of return on investment, particularly for a short-term credential. So I think that’s the biggie to make sure and you know I think in that helping folks just have a better sense of what’s possible. I mean we really make people figure this out all on their own and that’s not cutting it.

Matt Sterenberg (03:29.92)
And there’s a lot of people trying to get those answers. Can you give us an idea of the different players, different organizations that are actually trying to answer that question that you highlighted? Because as someone who’s living and breathing this, I see all these different organizations come out with these initiatives. And it seems like there’s a lot of activity here, but we’re at the early stages. What are organizations trying to do? Who’s actually participating in that work?

Paul Fain (04:00.128)
Yeah, a lot of kind Venn diagram overlapping strategies, you know, around.

measuring value, tracking, classifying credentials. One of the spaces, the learning and employment record space, which of course, Instructure and Parchment play a big role in, know, briefly describing that. It’s not easy to do anything briefly in this space, you know, ways for folks to display what they, their skills, what they learned.

in a kind of digital format that is portable. You know, we’re not talking about the old school paper transcript here, but a way to really show measures of what a credential provided them. That’s one area. I think another kind of big space that gets to that is…

the credentials of value work that states are doing. And it’s some interesting vendors and nonprofits in this space. I like to steal this quote from Joe Fuller at Harvard Business School. He’s fantastic, by the way.

just that the future, if you want to look at what the future looks like in the credential space, you should look at Texas. You know, they’re big. have, because of the size of the state, they have some ability to do data collection and comparison that a smaller state doesn’t, in part because a lot of folks stay in Texas. don’t cross. It’s not like I went to school in Delaware where, you know, you’re in Maryland in five minutes. And they recently did a really, and I’ll just give you a brief flavor of

Paul Fain (05:46.78)
this. HB8 was the law in Texas which

sent a lot more money to community colleges. It’s a carrot and stick, know, 23, I think, percent increase for the overall budget for the community colleges in the state. But to get that money, it has to be linked to strong outcomes. know, they are looking that money is targeted to high demand fields and to be able to access it. The institutions need to prove that the programs are credentials of

value. That’s like building a plane while it’s in the air. The money is already flowing and they’re still working on a system to measure credentials of value.

Matt Sterenberg (06:34.08)
And what is value, right? We’ve got to establish a baseline there. Value to one person might not be value to another. Like that’s always a challenging conversation, but sorry, continue.

Paul Fain (06:45.065)
No, no, you’re absolutely right. And it’s an enormously complex question. mean, think about, and this is one of the things I think people often don’t think of, because I think we’re all kind of in, most of the people I talk with went to a four year college, have advanced degrees. I do not have an advanced degree, bachelor’s for me. But you’re thinking about.

a that most of this doesn’t really apply to where let’s say it’s a 12 week certification program in a skilled trade. You know, you’re coming in at a certain wage level that it may be quite a bit lower than what I think a lot of people think of. So and it’s also a short term program. So it’s not necessarily 100 percent clear how much of your wage gain if you get one from that comes from that credential. A lot of kind of short term out.

allied health programs are like that. I remember talking to a provider, a college system in Texas that does a lot of allied health, that some of their programs, median wage of incoming students is 9,000 a year. So you’re talking about kind of life stabilization, but.

still close to poverty wages in some of those fields. A lot of the high demand fields in our country are actually poverty wages, so does that count as a credential of value? Just a lot of tough questions.

Matt Sterenberg (08:06.286)
Yeah, that’s a really good point. the, we can’t solve the macro level challenges of what minimum wage is in a state or, you know, these big economic questions. so sometimes value is just getting you into a better spot. That spot is still not ideal to your point, but at least I’m from 9,000 to 30,000 a year, which is still a difficult place to be in terms of salary.

But I’m glad you brought up the advanced degrees thing because as an aside, I think that sometimes the conversation in these spaces, it’s a bunch of people with advanced degrees, with their PhDs talking about workforce credentials. And you brought up learning and employment records. One of my criticisms of it is if you took any learner today and you said the phrase learner and employment record or micro credential, they would have almost no idea.

what you’re talking about. So a lot of the like, could we build these things? Yes. But implementation matters. Learners understanding what they have matters. And that’s always my concern is that in theory, these things could be built in theory would be great if I had a portable learning and employment record that followed me wherever. How are we going to communicate what this is to learners to labor and get everybody to buy in and understand it? Yes.

It would be great if we had this standard and it follows me wherever I go. But there’s a lot of implementation challenges that go beyond technology, all this stuff. Like how are we actually going to make this something that is ubiquitous for people that are looking for a job? I think that’s a big challenge.

Paul Fain (09:52.46)
Totally agreed. And not to minimize any of the experiments that face challenges there in terms of broad use by the general public, but anything about the digital wallets, another kind of flavor of LER. Experiments in Indiana, Colorado, lots of states trying to do that.

challenge there is getting folks on both sides, people who might use a digital wallet to display their credentials or employers to use them.

I always think that states are probably the most promising place to look at this because they can bring together a lot of the pieces you need, a lot of the stakeholders to use some jargon to make these things have the critical mass. Alabama Talent Triad being one of the most interesting ones. There’s a bunch of states, but that is one of the most sophisticated ones. They put a lot of years, a lot of work into connecting the education and workforce systems, working with individuals to help

them get that credential when they’re in the system, having both sides kind of understanding it. Interestingly, and we’re very, I gotta do some reporting on this in the next week or two, Nick Moore was the czar in Alabama for that work. Oh, good score with him.

Matt Sterenberg (11:10.752)
and former podcast guest. Check out the episode.

Paul Fain (11:14.411)
I don’t Will, he’s fascinating. I really respect his knowledge in this space. So he’s in Washington now at the education department, leading the adult career technical education space. He just recently put out a blog item saying they’d like to do something like that at the federal level.

And so I don’t know what that would look like, but you probably need government to get in enough hands of folks to, know, that I think that’s a safe bet on right and left. you know, I think big tech companies are probably going to be part of the mix too. You know, obviously you all have a huge user base in the college space, you know, Workday, even Google. There’s a lot of interesting work to help people display their skills in a

that would actually take off.

Matt Sterenberg (12:08.758)
Yeah. Yeah. We’re certainly thinking a lot about it. I mean, that’s the whole idea of a time behind. Instructure and parchment coming together and structure being a lot of teaching and learning is happening on our platform. Part of it being the place that credentials it. there’s more capacity for us to represent what this credential actually is the skills and competencies embedded within it. So it’s certainly something in our mind, but to your point, it’s not, not easy. You brought up tech companies and Nick.

And so I want to bring up something that he said to me that really stuck out to me. And he said, we don’t want to give people wooden nickels, meaning a currency that can’t be used, right? Or can only be used in the very specific context. That’s a big challenge now that AI, we don’t know where it’s going. And it seems to be changing every week and no one really knows the impact on the workforce.

That’s the concern with some of these short-term credentials, right? That they’re gonna be disrupted by AI. And so the value of that short-term credential could be X this month, and it could be Y a year from now. How are you seeing the AI conversation impact workforce credentials?

Paul Fain (13:28.594)
Yeah, great question. I would argue that the entire credential spectrum

is challenged potentially by AI all the way to a PhD in computer science. Frankly, nobody is really safe, I think, from potential job disruption. you know, like I don’t, I’m not, I’m glad you said nobody knows because they don’t. I’m very, very sick of hot takes on this. I will tell you right now, nobody in your audience should care what I think is going to happen because I don’t know. And frankly, I don’t care what almost anyone

else thinks so I

Matt Sterenberg (14:10.242)
And the only person you should distrust is the person who says that they know. Yeah.

Paul Fain (14:13.898)
Well, and even like their guesses, like, just don’t care. Like, it’s really weird how pervasive that is. It’s like people feel like they have to have an opinion on AI and I’m like, no, you really don’t. You can keep it to yourself. But there are some people who know some things though. And I actually on my podcast have been trying to find those people. And, you know, like as a journalist, you think there’s somebody out there who has the answer. You just have to find them and convince them to talk with

I don’t actually think that is true on the job disruption piece. However, know, MIT, Pitt, Carnegie Mellon, it’s ironic that elite academic institutions are the places where I would look for the most trustworthy information on the value of education and how it might be changed by job disruption, given our current hostility towards elite higher education, particularly in Washington.

But, you there are some folks I’ve talked with who are, and you you’ve read some of this coverage in the last week or two, we’re talking in August. I think you’re starting to see more serious signals of disruption to entry level jobs. And the irony is after all this, all the years of worrying about automation for blue collar workers, manual labor, it looks like it’s people like me in the knowledge economy

who are probably going to feel it the most, any sort of communications, marketing, but finance, entry level finance. So yeah, I mean, those are four year degrees, if not advanced degree fields that we could see what some people think could literally be an AI driven jobs apocalypse. mean, and then these aren’t necessarily people who don’t know things who think that, but that’s part of what makes it so hard. I really don’t envy early

career or young people and having to make a guess on this based on like which professions are at risk. I know I’m going on long here, but just very briefly on the shorter term credential medical billing and coding. You get a certificate in that space. They can’t hire enough people even today. I’ve called a lot of folks in that space and they say that the hiring demand is high, but also it’s probably very threatened. We heard through the Rand Institute. didn’t they know it’s very hard to get companies to talk about who they’re actually.

Paul Fain (16:43.468)
replacing with AI, but the big healthcare system said they have fully replaced all humans for outpatient medical billing and coding. You can see why that would be something that AI could do and that’s happening now. So do those 60K jobs that you can get with a one year certificate go away? I don’t know, but I’m worried that people aren’t gonna get good guidance until it’s too late.

Matt Sterenberg (17:07.178)
And with all the uncertainty, what’s the alternative to just stop, you know, like not pursue education? Well, it might be eliminated or to stop these programs. Like we are at a very interesting place where we don’t want to be resigned to the fact that it’s going to take over or like, like you said, we can completely predict where it’s going to take over.

And so what do we do? I think we have to plow forward a little bit and we’ll figure it out, but it is a, it is a scary, you know, it’s scary just to basically have a bunch of people sit back and go, Hey, we really don’t know. We’re going to keep building, but we don’t know where the train tracks lead, but we’re going to keep laying it down. and I’m speaking personally. so yeah, you, you’re right, Paul. I do have an opinion. Everyone’s got an opinion on AI.

But, but yeah, that’s, think a big challenge and it’s scary for a lot of people, but I also, uh, I agree with you. It, it feels like either you’re an evangelist or you’re completely against. it’s like, what’s the measured approach, uh, oftentimes with AI. Um, so can you guide us to like, what are some states that are doing? Cause you highlighted Texas earlier.

Paul Fain (18:00.031)
They do.

Matt Sterenberg (18:26.786)
What are some other states doing that we can point to have like a really good collaboration between credentials and opportunity? You highlighted Texas. Are there any more states that you want to highlight as doing some phenomenal work in this regard?

Paul Fain (18:40.777)
Yeah, I I was going to say you could point at literally dozens that are doing some work. I would say that when you said phenomenal, I was just slightly triggered. But you know, it’s not the state’s fault, honestly. I think there are huge gaps in knowledge about credentials and the value of credentials in every case.

Nothing is up to what we need right now. That is, again, that’s not me. That’s the experts I talk with. are no solutions that are fully baked, but that’s because this is hard, as we’ve already discussed. So I think…

I actually talk with, you know, my newsletter and publication work shift are read by a lot of folks in state policy. And I talk with folk that’s, you know, really where most of the interesting action is policy wise on our issues these days. The feds are, there’s a lot going on in Washington. We can talk about that later. But, you know, states are the ones that have to really see on the ground.

what works and what doesn’t from an investment standpoint on credentials. And I think I hear this consistently across states, they need help.

They need tools that can help measure value. Anything that’s currently available is not good enough. yeah, there’s, you know, Alabama and Texas come to mind, Colorado, all sorts of interesting experiments around this. Investments in multiple areas. You know, I think I mentioned they’re, one of the digital wallet experiments they were doing was in a specific field of healthcare. So, you know, kind of an industry focus

Paul Fain (20:32.139)
which I thought was really smart. Minnesota has done some great work to lay the kind of infrastructure for data collection around credentials. So I could go on and on. There’s a bunch. But I think everyone right now is hoping that some more tools will come online soon because the investment in non-degree credentials in the States is going up and will continue to go up. And you’re going to see more federal money through

the Workforce Pell Grant that was just approved by Congress.

Matt Sterenberg (21:08.342)
Yeah. And if you want to learn more, we had Dr. Van Davis on to talk about that legislation short-term Pell, which had a few different iterations. And it’s basically the long and short of it is it’s, it’s for, it’s accredited institutions are going to get this funding and they have to do a lot to, to prove out the value of these credentials. And so there’s a lot, a lot of teeth in it from what I gather.

But you highlighted data. The College Transparency Act is something that’s going through right now that’s essentially they want some federal system for data collection. You highlighted the work that the states are doing. This is a very like Hamiltonian versus Jeffersonian debate here on what should we collect? Should we have a system federally? But I wonder how much this is going to change just given

how regional jobs are and will remain. feel like COVID impacted that a lot where there’s a lot of remote jobs, but every state wants to kind of keep their talent and their labor and wants to make it regional. But yet it is kind of silly that we don’t have any kind of standardized approach to this. What are you hearing from states related to the federal approach or maybe what you’re hearing in Washington?

Paul Fain (22:30.471)
Yeah, you know, when I was at Inside Higher Ed, I covered, monitored the College Transparency Act’s predecessor moves and the student unit record system. A lot of people who don’t follow higher education policy don’t know that in this country, we are not allowed by law.

to track individual students as they move across their education and workforce system. You know, for a long time, it was one of those, we see a lot of these, where the left and right kind of united, like the full circle, the horseshoe, in opposing that for a pretty long time around privacy concerns, do we really need to be doing this, et cetera. And then, you know, for a while it looked like it might happen. It seems absurd. Like if we really want to make sure

investments are paying off for taxpayers and students, should probably know individual level data about how people are moving through the system. But you know, I got to say lately, I think the privacy fears are back and bigger than ever. And you saw that because of the way Doge operated. They were accessing a lot of data and potentially using it in ways that were quasi legal, that scared a lot of people for good reason.

So I think that those efforts were set back quite a bit by this administration and I’d be surprised. I mean I get surprised every day so but if a federal student unit record was passed anytime soon. So I think you’re probably going to have to rely on really clever ways of getting at that probably more in the state and regional level. know protected information through unemployment insurance linked with state data systems and there’s a lot of work afoot.

to do that. you know, I think honestly, the pressure, the urgency to get better at this is so high. And as you said, it’s going to be enhanced by the AI impacts that I’m hopeful that some more solutions will come online.

Matt Sterenberg (24:37.166)
Yeah, it’s an interesting question because it’s there’s data collection and there’s personal data collection. What do they know about me as an individual versus anonymized data that can indicate trends, but what do they know about me personally? I remember this discussion. I mean, this discussion has been going on for a long time and certain States, they have like a unique identifier that tags each student, but it’s not connected to me as an individual necessarily.

I saw a joke one time, basically like your, where you get your oil changed has more information about you than like our healthcare or education system, right? They have your complete history of all the work you’ve ever done on your car, your VIN number, all this stuff, but they really can’t help me when I go into the doctor’s office or when I matriculate into higher ed, there’s very, very little that they actually know about me, which is always kind of funny and what, what we measure. Paul, go ahead.

Paul Fain (25:35.976)
Totally. you think, yeah, just, you know, folks on the inside at the AI labs and big tech companies are frankly pretty frightening when they talk about privacy and AI universally. Like, hey, you really should be more careful than you even think. I would assume that OpenAI knows insane things about me. Google, god, god, I’m wearing a Fitbit right now. So Google knows literally everything about me. But I think, I think…

The federal government is different. I can see the argument. I used to frankly think it was BS. I used to think it was the private college industry who was the primary opponent successfully beating back regulation through fighting that data transparency. But now I’m not so sure. I think people have good reason to be worried about federal data systems.

Matt Sterenberg (26:30.496)
Yeah, I mean, if you don’t like one of the political parties, it’s really easy to say, okay, well, if the people I like had the data, I feel fine. You know, okay, we’ll give it to the other side, see how much you like it. And so I do think it’s important to have these discussions and figure it out. And sometimes these discussions just lead to something else, right? So we’re going to start here, and then we’re going to figure out how the states do it. I think regional compacts,

Paul Fain (26:54.418)
Yes.

Matt Sterenberg (27:00.376)
could be a nice way to say, how do we bring all these states together from a higher ed perspective? And then if we all start kind of talking the same language, there’s a way to kind of think about a federal system that also has regional and state control. Like what is the minimum amount of information that we’re gonna collect regionally? How do we collate that together? I think there’s some possibility for impact.

Paul Fain (27:24.028)
Just very briefly, Julia Lane, of the kind of data kind of experts to many folks who work on this site, a mentor across the field, she’s been pushing, she had a really good piece in the MIT press for a public data trust, some sort of philanthropically funded, tight rules, a public data trust with state data systems.

know, ways to give people faith that your information is protected, but still have really good individual data. So there are smart people working on it, but I don’t think anyone’s fully there yet.

Matt Sterenberg (28:03.628)
Yeah. Yeah. Well, Paul, before we wrap up, anything that you want to highlight, anything I should have asked you or anything that you want to bring up related to this ecosystem, because you’ve got, and again, a plug for your newsletter and the cusp podcast, check those out. He’s having some awesome guests on the podcast and some great content in the newsletter, but is there anything I should have asked you or anything that you want to highlight before we end our time today?

Paul Fain (28:30.024)
No, you asked the right questions. mean, but I would just say, you know, I used to…

I used to always remind myself when covering traditional higher ed that you can’t generalize about that industry. It’s so big. Like, what are we talking about here? When people start talking about sky high tuition, are we talking about Cal State and the community colleges that are not sky high tuition? it’s, you have to be specific and you, frankly, you have to be regional. People still get their education almost overwhelmingly in their region. And that applies not just to four-year degrees and master’s degree.

but to these short-term credentials. It’s even more enormously complex there. Are we talking about truck driving licenses? Are we talking about nursing? You have to be specific and I think very nuanced in discussing this. I think we do a disservice to the kind of complexity of these challenges when we make big bold pronouncements about wide swaths of this space.

Matt Sterenberg (29:33.688)
Well, Paul, thanks for joining me and check out work shift.org.

Paul Fain (29:38.066)
Thanks, Matt.

There’s always more to learn.