By Peter Wiseman and Zac Ashkanasy
There is growing evidence that microcredentials will be ascendant in 2023.
Soon the Microcredentials Marketplace will go live, offering a one-stop shop to help students identify opportunities. Legislation currently before parliament will allow students to use FEE-HELP for university-offered microcredential courses. And the review to inform the Universities Accord, flagged by the Education Minister last week, will no doubt include microcredentials as part of improving accessibility and lifelong learning objectives.
We are at a pivot point for microcredentials in Australia. Many universities, TAFEs and private providers already offer microcredentials, but quality and uptake varies. Growing university and TAFE microcredentials will be essential to ground the emerging market in quality education for students in ways that address industry skills needs and are sustainable in the long term.
To understand the role of microcredentials, we need to understand their economic function.
The value of microcredentials is as much about their utility to employers as to students. Microcredentials have been shown to increase workers’ income through reducing the uncertainty employers have of their skills, rather than through directly boosting productivity.
Microcredentials are also impactful when the opportunity cost (time off the job) of obtaining deeper expertise is too high for individuals and employers. In the current low-unemployment environment, that opportunity cost is high. But as the labour market weakens, so too does this opportunity cost. The market is hot now but we cannot assume the heat will always be there.
Researchers in Europe recently investigated at what point in people’s careers microcredentials were most effective. They found that for people at the start and for people with deep work histories, microcredentials had little impact on earning potential because professional experience counted for more in the eyes of employers. As researchers Otto Kässi and Vili Lehdonvirta note, “These effects leave a narrow range of workers who benefit significantly from microcredentials: early-career workers who have successfully broken into the market but still lack a more extensive work history.”
The upshot? Universities need to bring agility to their offer, flexing the products to respond to different contexts and needs. And targeting microcredentials at key career transition points will maximise effectiveness.
From a continuous learning perspective, we can think about microcredentials in two ways: as repackaging existing content for new audiences, or as fast-twitch education development. For students and institutions to get real value from microcredentials, it needs to be the latter.
But there is an inherent risk for universities to step into the new before the market is fully formed. Funding and systems – both from government and from individual institutions – need to accommodate this risk.
Universities can be confident microcredentials will not cannibalise their existing student base. Microcredentials are unlikely to replace traditional bachelor’s degree programs and are unlikely to significantly impact on traditional postgraduate education. They present a new opportunity to support lifelong learning and an additional revenue stream.
Where and how to invest in microcredentials is a critical challenge facing universities. As the market is in its infancy the evidence about what works is limited. As development costs can be substantial, it can be hard to make the case for investment when it is uncertain where the demand is.
Done well, a cohesive microcredential portfolio can complement a university’s broader suite of degree programs, attract additional students and deliver a positive return on investment. But without careful planning, the results may be mixed and the costs can outweigh the benefits.
Triangulating from data analysis about industry need and student demand helps to focus effort. For industry need, Lightcast provides a synthesises of data to deliver a nuanced and timely picture of the labour market and how it is changing. For student demand, Studyportals, a global study choice platform, provides rich data about demand for education across Australia and internationally, and an ability to drill down to specific locations and disciplines. Studyportals page view data has been found to be a strong predictor of future demand for degree programs, and this will likely be the case for microcredentials.
The data shows that over the past four years the most frequently searched short courses in Australia have been in engineering and technology, followed by electrical engineering. Each of these have about 30 per cent more interest than the next highest, business management, and 50 per cent more than marketing, mechanical and industrial engineering, and graphic and design.
But the biggest surge in interest among the top 10 most-searched short courses is in nursing. Since the start of the pandemic in 2020, searches for nursing have grown more than six-fold, as aspiring nurses seek ways to gain or refresh their credentials.
Bringing this data together is valuable. Putting it to use can accelerate the value of microcredentials for students, industry and universities.
Get in touch to discuss how we can support your institution to prepare for the growth of microcredentials.
Connect with Peter Wiseman and Zac Ashkanasy on LinkedIn.
Prepared with input from Hamish Ride.
A version of this article was first published in The Australian.
Published on 25 November 2022.