Shifting Investment, Shifting Demand: Trends in Credential Reimbursement and Labor Market Alignment Under Ohio’s IWIP Program

• In Event: Aligning Course-Taking and Credentialing Programs with Labor Market and Civic Outcomes

Abstract

Career and Technical Education (CTE) programs have evolved significantly over the past several decades, shifting from traditional vocational training toward preparing students for high-demand, high-wage careers (Dougherty & Lombardi, 2016). Ohio’s Innovative Workforce Incentive Program (IWIP), developed by the Governor’s Office of Workforce Transformation (OWT), aims to increase the number of high school students earning industry-recognized credentials (IRCs) in priority sectors (Ohio Department of Education and Workforce, 2024). IRCs verify individual labor competence and can take the form of certifications, certificates, and licenses. IWIP functions by providing direct reimbursement to schools for students who earn qualifying credentials, aligning with Perkins V’s goal of connecting education to workforce needs (Advance CTE, 2020).

 

In a report outlining the benefits of CTE participation, Dougherty (2016) provided a set of recommendations, one of which was align skills and credentials to industry needs. This study provides evidence as to whether state policy can effectively address this recommendation.  Research has demonstrated that high school students who earn IRCs are more likely to graduate and enroll in postsecondary education (Glennie et al., 2021, 2024). To assess the alignment between IRCs and labor market demand, Walsh et al. (2019) analyzed job postings as a proxy for employer need. This study offers a complimentary approach by analyzing a state-administered, incentive-based IRC program focused on a curated list of high-value credentials, and measuring alignment at the career cluster level.

 

This study contributes to policy discussions on aligning CTE credentialing with labor market projections through state funding mechanisms through a descriptive analysis of IWIP implementation from 2021 to 2024, addressing two research questions:

(a) How has earning IWIP-identified IRCs changed over time as evidenced by reimbursements?

(b) How well does IWIP-identified IRCs production align with projected labor market needs?

 

Approved IWIP credentials represent a subset of the broader Ohio Department of Education and Workforce list of IRCs, selected by OWT for their alignment with high-growth, high-demand sectors (Ohio Department of Education and Workforce, 2025). Using publicly available administrative data on credential completions and reimbursement, combined with occupational projections from the Ohio Department of Job and Family Services (ODJFS) and OWT, this study finds that credential production increased over 600% during the study period. However, growth was highly concentrated in Advanced Manufacturing and Construction, which together accounted for more than 75% of all credentials but less than half of projected job openings. In contrast, sectors such as Health and Supply & Transportation, which comprise over 40% of Ohio’s projected workforce needs, remained under-credentialed.

 

These findings highlight persistent misalignments between state investment and occupational demand, raising important questions about whether IWIP’s reimbursement structure is effectively incentivizing credential production in Ohio’s most in-demand career clusters. 

Authors

• Kenny Chio Saephan, The Ohio State University
  Presenting Author

• Amanda Bowling, The Ohio State University
  Non-Presenting Co-Author

• Jay Plasman, The Ohio State University
  Non-Presenting Co-Author