Future of work

Main findings

An analysis of more than 156 million Americans’ resumés by the Brookings Institution finds that non-degree credentials (NDCs)—such as certificates, certifications, badges, and micro credentials—deliver meaningful wage gains only when they’re directly relevant to a worker’s occupation. Workers without a degree stand to benefit most from earning these, with wage premiums that are nearly double those of college graduates, yet they are the least likely to hold them. With more than 1.5 million unique credentials now available to earn, workers face a crowded and largely unregulated landscape where distinguishing genuinely valuable credentials from low-value ones is increasingly difficult.   

Key takeaways  

• Job relevance is the critical factor in credential value. A first job-relevant NDC is associated with a 3.8% wage premium (for workers of all educational backgrounds)—more than double that of a job-irrelevant NDC. Stacking credentials that are not job-related yields zero additional return.  

• Certifications are usually exam-based and renewable, whereas certificates are typically one-time awards for completing short courses. When they are relevant to an occupation or field, certifications show strong, cumulative returns for workers. Badges and certificates tend to produce a one-time signal boost with little cumulative value.  

• Workers without a bachelor’s degree stand to gain the most from earning certifications. For these workers, the wage premium from a first job-relevant NDC is about 6.8%—nearly double the return for degree holders. However, this group is less likely to earn NDCs, a situation that may signify access and information barriers.  

• The NDC market has expanded rapidly in recent years. More than 1.5 million unique credentials are now available, and listings of these credentials on resumés are up nearly 35% in the past year alone. This growth has created a crowded, largely unregulated landscape in which workers struggle to distinguish high-value from low-value options.  

• Linking credentials to employment outcomes and wage data could support the identification and expansion of impactful programs. Proposed U.S. federal funding (through an expansion of Pell Grants to short-term programs) could channel billions into these credential programs. That would make accountability measures—such as linking credentials to employment outcomes and publishing wage data—crucial.   

Plain language summary  

The market for NDCs (such as badges, certificates, certifications, and micro credentials) has exploded in recent years, with more than 1.5 million unique options now available and credential listings on resumés jumping by nearly 35% in the past year alone. Driven by rapid technological change and shifting job markets, workers at all career stages are turning to these shorter, more affordable alternatives to traditional degrees to build and signal their skills.   

But not all credentials are worth pursuing. An analysis of more than 156 million Americans’ resumés finds that wage returns depend almost entirely on whether a credential is relevant to a worker’s specific occupation. A first job-relevant credential is associated with a wage premium that is more than double that of a credential that is not job-irrelevant. Continuing to stack irrelevant credentials delivers no additional financial benefit.  

The type of credential also matters. Certifications, which typically require proctored exams, third-party validation, and periodic renewal, show stronger, more cumulative returns for workers than badges or certificates, which tend to produce a one-time bump that does not increase over time. This suggests that certifications reflect genuine, employer-recognized skill-building and are not just signalling.  

The workers who stand to benefit most are those without a four-year degree and those who are early in their careers. These workers could see wage premiums of  6–7% from a first relevant credential—nearly double what degree holders experience from the same credential. Despite this potential, these groups are currently less likely to hold NDCs. This underscores significant gaps in access and awareness that need to be addressed.  

The research calls on policy-makers to build stronger accountability into public funding for credentials, for example by publishing outcomes like employment rates and wages associated with credentials, standardizing credential data, and tying public funding of credential programs to evidence of real labour-market value. Without these guardrails, public dollars could flow into low-value programs that do little to advance workers’ economic prospects. 

Why the results matter

For post-secondary educators and students:

Although this analysis looks at the U.S. job and education markets, research conducted for Canadian institutions shows a similar pattern in both the growth and value of short-term programs. It provides a clear signal that the credential marketplace is becoming increasingly competitive, which underscores the need for better tracking and data collection to provide targeted support to students choosing programs and credentials. As short-term student funding programs (such as the Canada Student Financial Assistance Program and Better Jobs Ontario) grow in popularity and receive more public funding, institutions will face pressure to demonstrate that their credentials lead to real employment outcomes in relevant fields. Colleges that offer certificates and micro-credentials will need to ensure these are recognized by employers and aligned with in-demand occupations. Otherwise, they risk losing students and funding to providers that can demonstrate this more clearly.  

For students, this research highlights a risk: earning a job-relevant credential can meaningfully boost wages, particularly for those without a degree or who are early in their careers, but the market is crowded and largely unregulated, making it difficult to discern high-value credentials from ones that simply clutter a resumé. Students should prioritize credentials that are well-recognized in their target occupation (ideally involving rigorous assessment) and look for outcome data, such as employment rates and typical wages, before they invest their time and money.  

For employers:  

For employers, this research reinforces the value of skills-based hiring approaches that look beyond degrees while also highlighting the need for discernment. Not all credentials signal equivalent competency. Certifications that require third-party validation and regular renewal appear to reflect more genuine skill development than badges or certificates earned solely through course completion. Employers that want to attract skilled workers and reduce credential noise may benefit from being explicit in their job postings about which credentials they recognize and value. Ultimately, this will help shape a more accountable labour market.