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WIOA Training Programs Generate Significant Returns for Graduates

To better understand the return on investment associated with the state’s administration of workforce training programs under the Workforce Innovation and Opportunity Act (WIOA), MCDA utilized wage records of training completers to project the level of increased earnings relative to education costs over a ten-year period. 

About the Study

The study analyzed wage outcomes1 of graduates of programs found on the state’s Eligible Training Provider List (ETPL), which serves as the official list of schools, colleges, and training institutions made available to eligible Michigan Works! Participants under WIOA. The primary objective of ETPL programs is to help clients find and retain employment. Consequently, these programs report employment rates and earnings for two years after program exit. To quantify the long-term value of ETPL programs, this analysis extends that window by projecting wages over a ten-year time horizon. The long-term ROI estimates account for both the projected wage gains over time and program cost. By providing a clear picture of long-term outcomes that better capture benefits associated with training, this analysis supports more informed choice about workforce investments and funding priorities.

Results

The study concluded that the average training completer will earn an additional $141,600 in the ten years following their award, compared to a baseline of similar Michiganders with only a high school diploma or equivalent. Overall, completer wages are projected to increase over 16 times the amount spent on education costs (tuition, mandatory fees, books and other supplies) over the period. This return will vary by educational award, as shown in Figure 1.

Author:

Certificates are projected to produce the highest level of increased wages per dollar spent on training.

Figure 1: Total Wages Gained per Dollar Spent

*Includes Industry-Recognized (IR) and Institution of Higher Education (IHE) Certificates.

Source: One-Stop Management Information System (OSMIS), Michigan Center for Data and Analytics (Analysis)

 

Certificates, the most commonly conferred award, increased wages by nearly 19 times their cost, exceeding the levels calculated for associate and bachelor’s degrees. This result was in large part due to their low relative cost. The median certificate’s costs totaled $5,200, while median costs for associate and bachelor’s programs totaled $20,800 and $62,400, respectively.

Despite less wage gain relative to costs, associate and bachelor’s programs were linked with higher starting wages and rates of employment.

Figure 2. Award Type Summary Statistics

Award

Awardees

Median Cost

Median Starting Wage

Percentage Employed2

Certificate

8,469

$ 5,200

$ 28,800

68%

Associate Degree

583

$ 20,800

$ 53,200

83%

Bachelor's Degree

159

$ 61,400

$ 62,400

90%

Source: One-Stop Management Information System, Unemployment Insurance Agency (Wage Records), Michigan Center for Data and Analytics (Analysis)

 

The relatively small number of graduates that earned associate and bachelor’s degrees experienced significantly higher starting wages and approximated rates of full-time employment than certificate completers. Per MISchoolData Entry Level Wages, the degree program starting wages are higher than what is observed across Michigan as a whole, while ETPL program certificate earners in the study tended to earn less. There are several reasons WIOA-eligible earners may be earning less than others across the state. Specifically, WIOA-eligible learners often have existing barriers to employment, and ETPL certificate programs are more commonly shorter-term, skills-driven programs that may be associated with lower wages.

Conclusion

Most individuals that complete workforce training under WIOA complete certificate programs. These programs generate significant wage gains relative to their cost, despite the fact that their entry level wages tend to lag the general population of Michigan certificate earners. Individuals that complete associate and bachelor’s degree programs earn higher wages, though the level of additional wages relative to education cost is lower. Overall, each of these award types were found to generate wage gains well beyond their cost, indicating that this public investment yields positive and substantial returns, not considering the additional economic and community benefits associated with improved workforce participation.

 

1Wage records provided by the Michigan Unemployment Insurance Agency (UIA).

2Employment percentage is an approximation of individuals working at or above 30 hours per week at the 2023 minimum wage of $10.10. Exact working hours for each individual is unknown.