Conducting Return on Investment Analyses for Secondary and Postsecondary CTE: A Framework

Project Overview

Principal Investigators

Kevin M. Hollenbeck
Vice President, Senior Economist, and Director of Publications
W. E. Upjohn Institute for Employment Research

CTE’s role in connecting secondary education with workforce development has long been recognized, but current CTE evaluation systems have struggled to offer objective evidence to determine how CTE adds value to the U.S. economy. Return on investment (ROI) studies may help the field accomplish this task.

This specially commissioned study by Kevin M. Hollenbeck of the W. E. Upjohn Institute for Employment Research extends Hollenbeck’s work estimating the rate of return for workforce development programs, including secondary and postsecondary CTE, in Washington state.

In this study, Hollenbeck calculates ROI based on estimates of the net impact of CTE on individuals’ labor market experiences and government income supports after participating in CTE or workforce development programs. The paper discusses his estimation approach and presents estimates for postsecondary and secondary CTE. Hollenbeck found that participants in CTE programs reaped substantial returns-positive earnings-with almost nil or negative costs for secondary CTE. At the postsecondary level, any associated participation costs (tuition, foregone earnings) were more than outweighed, even over the short term, by the economic payoffs of participating in CTE.

The NRCCTE’s accountability and assessment projects include the publication of a set of guidelines on different approaches and methodologies to measuring ROI for CTE. Through its secondary data analyses, NRCCTE staff are also exploring the ways in which national CTE data-from the U.S. Department of Education, Office of Vocational and Adult Education, and the National Center for Educational Statistics (NCES) sample surveys-can be used to develop appropriate methodologies for calculating ROI for CTE.