How States Are Shaping the Future of Short-Term Credentials

Editor's note: The article was updated Aug. 21, 2025, to clarify wording in the headline.

More and more students in the United States are looking for flexible, shorter-term postsecondary options—known as nondegree credentials—that align with today’s job market. As these programs grow and change quickly, students often don’t have clear, reliable information to help them judge the quality of these credentials. At the same time, states are working to understand how these shorter programs fit into the broader landscape of postsecondary education and workforce development.

This spring, researchers from The Pew Charitable Trusts participated in a panel event with education and workforce experts to discuss how policymakers can help shape the growing short-term credential market to meet the needs of students, employers, and state economies. The session highlighted the release of a new report from the Western Interstate Commission for Higher Education (WICHE) that explores several examples of how states can use policy tools to guide and strengthen this growing market. WICHE is made up of representatives from 15 Western states and the U.S. Pacific Territories and Freely Associated States. Members share ideas about how to improve higher education and workforce development.

Panelists offered examples of how states are approaching oversight and funding for short-term credentials, the different roles and perspectives of key players in the field, and areas where more research and policy work could better connect credential programs with workforce needs. The discussion focused on three key points:

State policy levers shape the short-term credential landscape

States have many mechanisms available to set policies to expand short-term credential options. These range from state authorization, which determines which postsecondary institutions can operate within a state, to program eligibility for financial aid that states may provide for students. Underlying these policies are important questions about how states define program quality and what success looks like for students after completion. However, there is significant variation in how states use these tools, and the responsibility for implementing new or updated policies is often spread across multiple state agencies. As policies continue to evolve for offering short-term credentials, understanding how state approaches work will be key to supporting innovation while ensuring that students have access to high-quality, high-value programs.

“[It’s] critical for policymakers to think about how to strike the right balance between encouraging enrollment in these programs while also ensuring transparency and quality,” said Phil Oliff, senior officer on Pew’s student loan initiative. States are essential, he said, for “ensuring that policy balance.”

Christina Sedney, WICHE’s director of policy and strategic initiatives, highlighted how Colorado uses policy levers to oversee short-term credential providers. “Their statutory language really broadly defines the terms ‘education’ and ‘school,’” she explained, which gives the state “oversight over a whole range of private providers, whether it’s accredited institutions at the sub-baccalaureate level or a private company.” This allows the state to evaluate providers routinely on factors such as workforce relevance and other key outcomes.

Sedney also discussed state policy levers related to funding and investment, such as dedicated financial aid programs that are growing in popularity and size. For example, Virginia’s Fast Forward program supports community colleges that offer short-term noncredit programs in high-demand fields identified through labor market data. Students enrolled in programs eligible for Fast Forward pay only one-third of the total cost up front; once they complete the program, the state pays a portion of the remaining cost. The initiative has seen significant growth since its creation in 2016, with both enrollment and funding levels increasing each year.

Momentum has been growing around developing shared quality standards in the states. Sedney said that Alabama has established quality metrics through its Talent Triad initiative. Triad leaders aim to foster collaboration among students, job seekers, employers, training providers, and state policymakers to establish a skills-based economy and promote economic development in the state. In 2023, Alabama created the Committee on Credential Quality and Transparency, building on earlier collaboration between state workforce councils and postsecondary education systems. The committee’s work has helped to define in-demand occupations and set clear criteria for identifying quality within credential pathways.

Diverse perspectives in the short-term credential space

Because short-term credentials are often governed by several different state agencies, policymakers can face structural challenges in getting a clear and comprehensive picture of the landscape. That in turn can make it difficult to understand what steps are needed to elevate a state’s short-term credential marketplace. Panelists emphasized that in-state coordination, particularly across different agencies and entities in the state, is important for these reasons, and they noted that executive leadership is key to making it happen.

Washington is one state that recognizes the value of collaboration. Marina Parr, of the Workforce Training and Education Coordinating Board, shared that the state’s strategic workforce plan identifies credential transparency as a key priority.

“We have a credential transparency advisory group that pulls in partners from across our system to talk about how to make sure folks are able to really see what’s inside a credential” and understand its value, Parr said. This group promotes coordination within Washington and ensures that a range of perspectives are included in shaping the state’s workforce training needs.

In contrast, Wyoming has historically faced more fragmented coordination. Lauren Schoenfeld, a senior policy adviser in the Office of Governor Mark Gordon, noted that the state’s community colleges are locally controlled, meaning they aren’t required to collaborate or even share information. To address this, Wyoming established the Wyoming Innovation Partnership, a collaborative effort to pull together higher education, workforce, and K-12 partners across the state.

The initiative has helped us “find where we can work better together to really push these efforts forward and support economic development across the state of Wyoming,” Schoenfeld said. This kind of cross-sector collaboration is crucial for states to remain responsive to evolving workforce needs.

Bridging information gaps

Though interest in short-term credentials has grown, policymakers still face many unknowns. Short-term credentials “offer the promise of a direct, flexible pathway to advancement in the workforce,” Pew’s Oliff said, “but when we look at the limited data we have on outcomes of these programs, we find that the results are mixed.”

Speakers identified several areas where additional information on short-term credentials would be helpful.

For example, states should determine better ways to fund these programs and identify how best to meet industry needs and engage with industry partners, Schoenfeld said.

Parr, meanwhile, emphasized the need for the sector to do more to ensure that these credentials have value and deliver real returns for students, but she said that that depends on having adequate data to properly evaluate their outcomes.

Andrea Sisneros Wichman, of CNM Ingenuity, a provider of accelerated workforce training programs in New Mexico, noted that many of the unknowns around these programs may stem from the inconsistent language used across the field to describe them. Varying terminology “confuses learners and makes it more complicated for them to know which credentialing programs are of higher quality,” she said.

States are playing an increasingly important role in shaping the short-term credential landscape through oversight, funding, and collaboration. Although approaches vary, policymakers share the goal of ensuring that these programs are transparent, high quality, and aligned with workforce needs. Moving forward, strong coordination, better data, and buy-in from many different stakeholders will be essential to ensure that short-term credentials deliver real value for students and employers.

Shelbe Klebs is a senior associate and Brian Denten is an officer with The Pew Charitable Trusts’ student loan initiative.