Economic Returns to Postsecondary Credential Stacking

Abstract Credential stacking occurs when individuals earn multiple postsecondary credentials within a fixed period of time. Adult workers, in particular, can stack as a way to transition into and out of the labor market as they seek to develop new knowledge, skills, and competencies in response to shifting labor market dynamics, employer demand, and technological change. In this paper, we estimate the effects of subbaccalaureate credential stacking among adult workers in New Jersey for cohorts that straddle the Great Recession. We find that stacking boosts earnings by about $700 per quarter—an increase of 6 percent—and increases labor supply along the intensive margin by 3 percent. Benefits of stacking accrue largely to stackers who are female or Black, seek an associate degree as their second credential, or work in healthcare fields. These results suggest that organic credential stacking, even in the absence of prescriptive policy pathways, has meaningful economic benefits.