A $500 million training program you haven’t heard about

California’s new $500M education and training grant program focuses on student parents and will track outcomes as it expands in scope. Also, free short-term credentials from City Colleges of Chicago, which hopes state support and industry partnerships can replace federal start-up money.

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Local solutions

The federal government has increased its spending on workforce-focused education and training programs. And some new federal money is flowing toward apprenticeships and career-connected high schools.

Yet most of the big-ticket proposals to help younger Americans without bachelor’s degrees prepare for jobs didn’t materialize—including the Biden administration’s bid for $100B in workforce training—having been nixed or remaining stalled in negotiations with congressional Republicans over broader legislative packages.

Meanwhile, federal pandemic relief money for colleges is running dry, forcing some to find new ways to fund short-term training programs they created during the crisis.

Action continues in state capitals, however. And some states are flush with tax revenue, particularly California, which has a $100B surplus.

The new Golden State Education and Training Grant Program largely has flown under the radar, despite having a nearly $500M budget, taken largely from federal recovery funds. The onetime awards of $2,500 will go to Californians who lost jobs during the pandemic, to help them complete college and job training programs. And the statute that created the fund also requires that half of the grant money goes to student parents.

The investment is sizable even for California, says Sarah Hooker Bentley, the San Francisco–based director of population-specific strategy for JFF. 

“It is notable and encouraging to see an affordability solution focused on displaced workers alongside all of the major state initiatives and proposals that are focused on the more traditional pipeline from K-12 into higher education,” she says.

The California Student Aid Commission is developing the new program. And it’s building the plane while flying, as the commission has a broad mandate to get the money out quickly to vulnerable students while also seeking to ensure that the funds are used for quality credentials that pay off in the job market.

Reaching Students: The grants are being phased in. As an initial step, the commission is using FAFSA and Dream Act data to promote them directly via email, while also reaching out through campus-based programs that serve low-income student parents.

Students who enrolled after the pandemic began and who appeared to meet financial eligibility rules were the first priority.

The pilot approach, says Jake Brymner, the commission’s director of government and external relations, “allows us to get to the students within the closest reach quickly while we build out the other parts of this program.” 

Eligible Providers: The first phase of funds will be limited to public colleges and universities. But the commission said noncredit community college credentials, K-12 adult education programs, and a subset of state-approved workforce training providers will be eligible in future phases, all of which will be rolled out in the next year or so.

So far, the commission says more than 80 percent of the grant program’s applicants have been enrolled at a community college.

“We do think that this grant will be another important tool as we try to re-engage disconnected adults who might be considering training and education opportunities at community colleges,” Brymner says.

Tracking Results: For workforce training providers besides public colleges to be eligible, the state required that they must have a “demonstrated track record” of graduates earning a regional living wage within a year of completing a program. And the commission is mulling how to monitor performance of the grants when it opens up more broadly in later phases.

“We’re working with experts from the workforce development realm to help inform us about what kind of documentation the programs can submit to demonstrate this, given that there isn’t a single data repository where the state has such outcome data” for all potentially eligible training programs, says Brymner.

The commission will draw from what the state’s workforce development board learned through the High Road Training Partnerships project, which was designed to model good workforce partnership strategies, typically ones including colleges, employers, labor, and community groups. These programs—including ones focused on public transit, water, manufacturing, health care, and hospitality—featured firms that competed to deliver on equity, sustainability, and job quality.

Devon Minor, an associate director at JFF, said California could incorporate criteria the SkillUp coalition has identified for high-quality training providers, including programs that:

• Feature industry-recognized credentials
• Are offered by a provider with robust wraparound supports and financial aid available for learners—while also being reasonably priced
• Are accessible—considering geography, modality, and scheduling

“This is an important opportunity for [the California Student Aid Commission] to lean into the conversation about quality training programs and ensure that these funds go to support programs offered by reputable and responsible providers,” say Minor and Hooker Bentley.

Future Ready in Chicago

City Colleges of Chicago tapped federal pandemic relief funds to create free, short-term credentials in high-demand fields. But it’s looking to local resources to sustain the program going forward.

The two-year system’s new Future Ready scholarship, launched in the fall, includes more than 100 certificate programs. Most range in length from six weeks to a few semesters. It features both credit-bearing and continuing education credentials. Tuition is covered for the last-dollar scholarship if students complete in 150 percent of a program’s allotted time.

In its second semester, the short-term programs have enrolled 1,774 students, Juan Salgado, chancellor of the City Colleges, said during a virtual event hosted last week by the National Skills Coalition. Fully 86 percent of these students are Black or Latino, topping the overall 75 percent rate across the system. 

The system sought to make Future Ready as straightforward as possible to potential students. “At the end of the day, what we’re saying to you is it’s completely free,” Salgado said. “Now is the time to access this.”

Salgado said the bite-size programs are appealing to students.

“They have to find the time for it,” he said. “Most of our students are parents themselves, in the pandemic, trying to find ways to get ahead.”

Likewise, he says, local employers increasingly are asking the city’s two-year colleges to be aggressive about creating short-term programs that are attuned to the labor market. Unions are at the table, too. Future Ready also is designed to help Black and Latino students land jobs in fields where they are underrepresented, including roles as aviation technicians, in IT, and diesel and automotive technology, among others. 

Salgado said City Colleges is monitoring the 100-plus short-term credentials to see which ones pay off best for students. And to keep it rolling, the system isn’t counting on new federal money. Instead, it’s looking to see if it can access existing state resources such as the Monetary Award Program, as well as workforce or even K-12 dollars.

“Maybe some of the resources are already out there,” he said.

Partnerships with industry are key to making programs like Future Ready work, said Salgado. 

He pointed to Accenture, which didn’t hire a single graduate from the system five years ago, because the huge IT and consulting company would not hire entry-level workers without bachelor’s degrees.

However, Accenture has gone as far as any large corporation in dropping degree requirements, with a recent study finding that only 26 percent of its job openings call for degrees. And the company recently has hired 75 graduates of City Colleges into permanent roles, 60 percent of whom come from the city’s 15 most impoverished neighborhoods.

The Kicker: “Our big challenge is we need 20 or 30 or 40 Accentures in the marketplace,” Salgado said. “This is not a government solution. It’s a private-sector solution, facilitated through partnerships.”

Open Tabs

Student Debt

The U.S. Department of Education will discharge the remaining $5.8B in student loans held by 560K borrowers who attended campuses of Corinthian Colleges. The for-profit career college chain collapsed in 2014 amid scrutiny by the Obama administration and increasingly wobbly finances. It enrolled more than 110K students during the Great Recession’s wake. But Corinthian misled low-income students with high-pressure recruiting and false advertising for programs that often failed to deliver. The loan discharge is the largest in the department’s history.

Low-income families increasingly are paying for college with Parent PLUS loans, with roughly 3.7M families owing $104B through the federal program, according to a new analysis from the Century Foundation. Many families are struggling with repayment. And the share of Black families who use Parent PLUS and have no expected family contribution has risen to 40 percent. It’s 25 percent among Latino families.

Workforce Spending

The U.S. spent 0.03 percent of its GDP on workforce training prior to the pandemic, less than a third of what OECD nations spend on average, reports Eleanor Mueller for Politico. Workforce spending in the U.S. also has declined by two-thirds over the last four decades, according to the National Skills Coalition. The lack of investment may be contributing to inflation and hobbling the U.S. economy.

Roughly 240K jobs are unfilled in Quebec, a Canadian province with a population of 8.6M where about 200K young people are not working. Just 13 percent of those jobs require a college degree, according to Pierre Fitzgibbon, the province’s economy minister. Quebec’s government announced last fall that it would spend $3.9B over the next five years to train and attract workers in priority fields.

Income Gaps

Black and Hispanic households had stronger proportional income growth than white households as the labor market tightened in recent years, and fiscal policies during the pandemic preserved gains, according to a recent analysis by JPMorganChase & Co. The income growth among Black and Hispanic households narrowed the overall racial income gap, but large disparities remain.

Enrollment Nudges

Text-message “nudges” boosted student enrollment in Delaware Technical Community College’s allied health program, according to research by JFF and Persistence Plus. The text messages were designed to be a first step toward gauging students’ well-being and included a focus on career motivations. The strongest results were among underrepresented groups in health care—Black students and men.

College ROI

“There’s no reason trade schools need to fight the liberal arts in a zero-sum game. We need to think through how we create more and better of both opportunities,” U.S. Senator Ben Sasse, a Republican from Nebraska and a former university president, writes in The Atlantic. Sasse calls for outcomes-based funding, differential tuition, ditching the credit hour, reforming accreditation, and encouraging corporate certificate programs.

I’m planning a skinnier newsletter for next week. But I should have some news from JFF’s annual meeting in NOLA, as well as a reader survey for you. —@paulfain