Evaluating the ACT NCRC as a Signal of the Skills Needed for Labor Market and Educational Success in Missouri

ACT Research & Policy | Technical Brief | November 2018 1 Evaluating the ACT NCRC as a Signal of the Skills Needed for Labor Market and Educational Success in Missouri Jeffrey Steedle & Mary LeFebvre Since 2002, the Missouri Division of Workforce Development has offered ACT® WorkKeys® through job centers as a way to evaluate work readiness and assist individuals in their job searches. Examinees who achieve certain scores on the WorkKeys Assessments receive a National Career Readiness Certificate® (NCRC) at the Bronze, Silver, Gold, or Platinum level.1 The NCRC is a nationally-recognized, non-degreed credential of foundational workplace skills used by employers to support decisions about hiring, training, and promotion. This report describes a study conducted through collaboration between the Missouri Department of Economic Development—Missouri Economic Research Information Center (MERIC) and ACT Research. The goal of this study was to evaluate the NCRC as a signal of the skills needed for success in the labor market and in postsecondary education. Specifically, this study examined the relationships between NCRC level and unemployment claim duration, employment status, wages, and postsecondary grades. Data For this study, ACT gathered WorkKeys performance data for Missouri examinees from 2012–2014, and MERIC merged those data with demographic information, unemployment insurance records, postsecondary degree attainment, and cumulative grade point average (GPA). Quarterly wage records from the unemployment insurance database were provided nine months before and 15 months after taking WorkKeys. The complete data set, which included 27,475 records, was 44.7% female, 14.8% African American, and 80.9% White. In terms of age, 41.7% of the sample was aged 14–25, 31.6% was 26–40, 21.7% was 41–54, and 5.0% was 55 or older. The majority of the sample (60.6%) earned a Silver NCRC. An additional 12.9% earned a Bronze NCRC, and 24.7% earned a Gold or Platinum NCRC. Note that Gold and Platinum NCRC earners were combined because only 0.2% of examinees achieved the Platinum level. Employment Figure 1 shows percentages of job seekers with wage records in the unemployment insurance database before and after WorkKeys testing. Individuals with higher NCRC levels were more likely to have wage records in the database, which indicates that people earning higher NCRC levels were more likely to be employed. Despite this trend, higher NCRC levels were not associated with shorter periods of unemployment. The mean unemployment claim duration for each NCRC level differed little from the overall average of 19.5 weeks (Table 1). A variety of factors influencing unemployment claim duration could have masked the effect of earning higher NCRC levels. For example, jobs may have been scarcer for highly skilled workers, or those workers sought jobs with lengthier application, interview, and hiring processes. Another possibility was that employers hiring more skilled workers were less likely to recognize the NCRC. ACT.org/researchCopyright ® 2018 by ACT, Inc. All rights reserved. | R1728 ACT Research & Policy | Technical Brief | November 2018 2 Figure 1. Percentage with Wage R ecords in the Unemployment Insurance Database 40%53%59%64%52%64%68%71%Non-QualifierBronzeSilverGold/PlatinumNCRC Level9 Mo. Before Testing15 Mo. After TestingTable 1. Outcome Distributions by NCRC Levels Outcome NCRC Level Freq. Mean SD 25th %ile Median 75th %ile d* Unemployment Claim Duration Non-Qual. 79 18.7 11.4 9 21 24 Bronze 903 18.9 11.2 9 20 25 0.02 Silver 4997 19.7 11.4 11 21 25 0.07 Gold/Plat. 2116 19.2 10.5 12 21 24 -0.04 Post-Test Wages Non-Qual. 262 $3,600 $3,286 $1,084 $2,717 $5,121 Bronze 2288 $4,800 $4,209 $1,889 $3,832 $6,301 0.29 Silver 11258 $5,640 $4,535 $2,333 $4,714 $7,652 0.19 Gold/Plat. 4797 $6,549 $4,872 $2,975 $5,655 $8,945 0.20 Wage Differences Non-Qual. 150 $904 $3,580 -$670 $621 $2,347 Bronze 1468 $1,534 $4,293 -$731 $934 $3,344 0.15 Silver 7676 $1,149 $4,610 -$1,075 $854 $3,123 -0.08 Gold/Plat. 3401 $1,148 $4,759 -$1,167 $930 $3,367 0.00 Postsecondary GPA Non-Qual. 89 2.56 0.75 2.00 2.65 3.00 Bronze 825 2.74 0.70 2.22 2.77 3.22 0.25 Silver 5184 2.99 0.67 2.57 3.00 3.50 0.37 Gold/Plat. 2693 3.21 0.64 2.83 3.31 3.71 0.33 * Effect sizes reflect average differences in standard deviation units. Each effect size was calculated in reference to the next lower NCRC level.Wages For the 18,605 individuals with post-test quarterly wage records, average quarterly wages increased steadily from $3,600 for non-qualifiers to $6,549 for Gold/Platinum NCRC earners (see Post-Test Wages in Table 1). Each increase in NCRC level was associated with an average increase in post-test wages of $841–$1,200. The strong, positive association between NCRC level and post-test wages reveals that individuals earning higher NCRC levels tended to secure higher paying jobs. The same pattern is apparent in Figure 2, which shows average wages before and after WorkKey