A Randomized Controlled Trial (RCT) of...

Offering Pell Grants to Low-income Adults for Short-term Occupational Training

Reviewed

Workforce Development ,  Postsecondary Education
Accurately reported

The Institute of Education Sciences (November 2024) published RCT findings for two pilot initiatives that offered Pell Grants (federal financial aid) to low-income adults for short-term occupational training programs. These high-quality RCTs found sizable impacts on program completion, but no discernible impacts on the hoped-for economic outcomes: employment or earnings, measured approximately 3-5 years after program completion.  

Published Abstract

Pell Grants are the cornerstone of federal financial aid for students with low income who are enrolled in postsecondary education. Currently, these grants are available only to those who seek an initial undergraduate degree or credential requiring at least a typical semester of instruction. Because these rules may restrict access to programs providing skills needed for new or better jobs, in 2011 the U.S. Department of Education (ED) began pilots of two experimental expansions to Pell Grant eligibility. The first experiment allowed income-eligible students with a bachelor’s degree to obtain Pell Grants for short-term occupational training programs. The second experiment allowed income-eligible students to obtain Pell Grants for very short-term programs lasting as little as eight weeks. This report updates earlier results from a rigorous evaluation of the experiments conducted by ED’s Institute of Education Sciences (IES), adding new information about the experiments’ impacts on labor market success. This fuller picture could help Congress as it considers legislation to make Pell Grants for short-term occupational training permanent policy.

Key Findings

•  Offering Pell Grants for short-term occupational training programs to students with low income who have a bachelor's degree increased program enrollment and completion by about 20 percentage points.

•  Offering Pell Grants for very short-term occupational training programs increased program enrollment and completion by about 10 percentage points.

•  More than half of students offered experimental Pell Grants used them, receiving an average grant amount of $1,800; they were just as likely as those not offered the grants to also use federal student loans.

•  Despite boosting program enrollment and completion, offering experimental Pell Grants did not increase employment or earnings in the medium to long term.

Full Study Report

We have no suggested revisions to the study’s published executive summary.

No-Spin’s Study Overview

High-quality RCTs of two U.S. Department of Education pilot programs offering Pell Grants to low-income adults for short-term occupational training find no discernible impacts on employment or earnings approximately 3-5 years after program completion.

Program:

  • Federal Pell Grants, which help low-income students pay for postsecondary education, are normally available only to those seeking an initial undergraduate degree or credential requiring at least a typical semester of instruction. In 2011 the U.S. Department of Education launched two experiments expanding Pell eligibility to low-income adults for short-term occupational training.
  • Experiment 1 allowed low-income adults who had already completed a bachelor’s degree to obtain Pell Grants for short-term (up to 1 year) occupational training programs. 67% of individuals offered these Pell Grants accepted the offer; those who did received an average of $3,577.
  • Experiment 2 allowed low-income adults without a bachelor’s degree to obtain Pell Grants for very short term (8-15 week) occupational training programs. 52% of individuals offered these Pell Grants accepted the offer; those who did received an average of $1,312.

Study Design:

  • Experiment 1 randomly assigned 414 adults across 35 U.S. postsecondary schools to the Pell Grant offer versus a control group. Experiment 2 randomly assigned 2,270 adults across 28 U.S. postsecondary schools to the Pell Grant offer versus a control group.
  • Based on our careful review, both RCTs were high quality (e.g. baseline balance, low attrition, prespecified primary outcomes).

Findings:

  • Both studies found that the Pell Grant offer produced sizable, statistically significant impacts on completion of an occupational training program (52% treatment vs. 36% control in experiment 1, and 47% treatment vs. 38% control in experiment 2).
  • However, neither experiment found the hoped-for gains in economic well-being (i.e., employment or earnings), measured an average of 3.2 years after expected program completion in experiment 1 and 4.9 years after expected completion in experiment 2. The impacts were near zero and not statistically significant.   

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