Bridging Education and Opportunity: Exploring the ROI of Higher Education and Workforce Development
by Paula Nazario, 2025 HCM Policy Fellow
Higher education has long provided a pathway to economic mobility and a good investment that can lead to high-quality, well- paying jobs. Yet, despite these well-documented benefits, students are increasingly questioning whether a postsecondary credential is worth the time and cost. While many students still recognize the value of a college degree, this perception is weakening. A 2024 Lumina-Gallup Study found that confidence in higher education has significantly dropped from 57% in 2015 to 36% in 2024, signaling a potential tipping point as more people feel college is out of reach.
The main concern is that higher education is not accessible, affordable, or a worthwhile investment given the time and effort required. This is especially true for Black and Latinx students, who are more likely to question the value of a college degree and weigh their options based on financial aid. Many students also worry about securing a well-paying job following graduation and whether their degree will provide a strong return on investment (ROI). Given these growing concerns, transparency about the financial and career outcomes of degrees is more critical than ever.
HCM’s latest policy brief, Investing in Value: Return on Investment and Workforce Success in State Postsecondary Funding, explores how states can integrate value and ROI considerations into postsecondary finance systems. It highlights key strategies states are using to define and measure the value of higher education to ensure that students see tangible benefits from their investment.
Key takeaways include:
States are increasingly responding to calls for action on the value of postsecondary credentials by increasing their focus on measures of value in funding and policy decisions.
Embedding value must be done thoughtfully, as policy choices and data limitations can lead to unintended consequences and inequitable impacts.
While there is no right way to embed value into postsecondary finance systems, a thoughtful approach starts with a clear definition of value, reliable measures to capture that definition, and applying those measures in a way that incentivizes desired outcomes.
States that apply an ROI calculation in a finance system also need to consider variation in access to high-ROI programs, the affordability of such programs, a stackability strategy to ensure a higher ROI, and state support for low-ROI credentials that are nevertheless essential to the public good.
If students do not see the value in their credentials, college enrollment rates may continue to decline, which could, in turn, lead to broader economic and social consequences. This includes skills gaps in key industries, strained economies, reduced earning potential, greater reliance on social services, and decreased civic engagement. Alternatively, higher education correlates with healthier lifestyles: 69% of individuals with a bachelor’s degree engage in exercise, compared to 47% of those with only a high school diploma. To ensure students see a real return on their investment, states must:
Provide transparent data on alumni outcomes.
Improve clarity around financial aid and college affordability.
Strengthen the college-to career-pipeline so that low-income, first-generation, Black, and Latinx students have access to strong employment opportunities.
Although there is still a long road ahead, some states are taking steps to help students see the immediate value of their college education. California, Texas, and Virginia are leading efforts to increase transparency by developing publicly available data dashboards that allow students to compare pre-degree and post-completion earnings.
California’s Community College System’s Salary Surfer tool allows students to browse median earnings across career fields based on data from community college graduates. The dashboard shows that about 45% of associate degree holders earn more than $54,000, which is comparable to the median salary of a California resident with a bachelor’s degree. Making this type of data accessible to students reinforces the value of a college education and its ROI.
The Texas Higher Education Coordinating Board provides data dashboards and reports on degrees, graduation rates, student debt, and labor market outcomes. WhenTexas launched its dashboard, it became the first to create an open collaborative for stakeholders to track and improve program outcomes.
Virginia’s College and Career Outcomes Explorer dashboards provide students with access to median wage data by degree level and program type.
When it comes to state investments that ensure students get well-paying jobs, states like Ohio and Colorado have developed partnerships with companies to prepare students for the workforce.
Ohio has partnered with JobsOhio to expand employment opportunities for graduates. Through this initiative, the University of Cincinnati, the Cleveland Clinic, and Ohio State University have invested over $3 billion to develop three Innovation Districts, which are projected to create over 60,000 new STEM graduates and generate significant economic impact.
Colorado has also strengthened employer partnerships to prepare students for the workforce. CareerWise Colorado offers apprenticeship opportunities, while the Colorado Department of Labor and Employment provides job training, career counseling, and resources at no cost to students eligible for federal Pell Grants.
Making these types of resources and opportunities available to students ensures they have the information they need to make informed decisions about where to pursue a degree. It also fosters confidence in higher education and motivates students to persist in their studies. States have an opportunity to change the narrative around the value of a college degree or credential and provide students with the support they need to succeed in both college and career. By examining and modeling successful strategies from other states, they can address challenges related to college completion and ROI.
Paula Nazario is a 2025 Policy Fellow. The HCM Fellowship Program is an exciting opportunity for passionate, collaborative, and organized individuals interested in education policy. Our fellows gain invaluable experience in policy and advocacy, supporting leaders across our education team in areas such as postsecondary finance, accountability systems, and workforce development.
