Modernizing Federal Work-Study to Support Work-Based Learning

Policymakers and institutions of higher education want to expand access to work-based learning opportunities. These  opportunities, including internships, apprenticeships, practicums, co-ops, and project-based learning, can enhance career readiness and facilitate students’ career transitions. Most students, however, do not participate in quality work-based learning. Disparities in access mean that low-income and first-generation college students are less likely to obtain meaningful work experiences.

Policymakers, stakeholders, advocates, and experts across the ideological spectrum have looked to the Federal Work-Study (FWS) program as part of the solution to this problem. In recent years, the federal government has invested more than $1 billion annually in subsidizing employment for students with financial need through FWS, but most of these jobs are on campus and have little relevance to students’ areas of study or career interests.

Modernizing Federal Work-Study could transform what is currently a program oriented toward providing subsidized employment to colleges and universities into an outcomes-based program that expands access to quality work-based learning. As the United States faces a growing human capital challenge, using FWS to provide meaningful work experiences would give students more opportunities to prepare for a career and help employers strengthen and expand their talent pipelines.

To inform understanding of how FWS can help scale access to work-based learning opportunities, the Bipartisan Policy Center convened experts, stakeholders, and practitioners for roundtable conversations on strategies for expanding access to work-based learning, on challenges to these efforts, and on the potential for Federal Work-Study to better support meaningful work experiences. This report surveys how states, institutions, and the federal government have deployed FWS dollars to support work-based learning and identifies key barriers to these efforts. It further discusses how changes to FWS could help address these challenges and enable more students to obtain quality work-based learning experiences.

Institutions, states, and the federal government have sought to use FWS for work-based learning. Some institutions and states are working to make on-campus FWS jobs more meaningful and “internship-like.” Federal initiatives have experimented with using FWS to expand student access to off-campus jobs and encouraged institutions to deploy Federal Work-Study for service learning. In parallel with these efforts, intermediary platforms and providers have developed innovative strategies for improving access to work-based learning, including through project-based learning and online work opportunities.

Several factors hinder efforts to use FWS for work-based learning and limit the program’s ability to support broader access to meaningful career experiences.

• Barriers to Access. Inadequate compensation, lack of transportation, and challenges balancing career experiences with coursework, jobs, and family responsibilities can prevent students from participating in work-based learning.
• Administrative Challenges to FWS. Administrative barriers make it challenging to use Federal Work-Study for off-campus jobs. The program provides a smaller subsidy for jobs with for-profit employers than for on-campus work, often making it difficult for small businesses to employ FWS students. FWS is also administratively complex and burdensome, especially for off-campus opportunities.
• Challenges Building and Maintaining Partnerships. Many colleges and universities do not have the institutional capacity for building and managing work-based learning partnerships with employers at scale.
• Too Few Work-Based Learning Opportunities. Demand for quality work-based learning experiences outstrips the supply. Expanding the supply of meaningful work experiences will require addressing the value proposition of work-based learning for employers and developing strategies that encourage greater employer participation by providing value for them.

Changes to Federal Work-Study can help address these barriers and transform FWS into a program that expands access to quality work-based learning for low-income students.

BPC identified five key strategies to guide policymakers’ consideration of how to update FWS.

1. Adopt a Portfolio Approach to Expanding Work-Based Learning. Expanding access to quality career experiences requires a continuum of opportunities that responds to the needs of different students. Strategies for using FWS to support work-based learning can include higher quality on-campus roles, off-campus jobs, and service learning. They might also include using FWS to support a wider range of opportunities, such as project-based learning, and to provide compensation for unpaid internships and work experiences that are integrated with classroom instruction.
2. Improve the Collection of Outcomes Data. Deploying FWS dollars for work-based learning requires data on outcomes to determine the most-effective approaches. Federal policymakers could strengthen the data infrastructure around FWS. They could also require enhanced data collection and analysis as part of changes that provide more flexibility in the use of FWS funds.
3. Reform FWS Allocations. The federal government can improve access to work-based learning opportunities by directing FWS funds to the institutions serving the largest share of low-income students. The Federal Work-Study funding formula is outdated and regressive. The program allocates an outsized share of dollars to wealthier institutions: Public two-year schools enroll 43% of undergraduates but receive less than 18% of FWS funds. Basing allocations on Pell enrollment or completion would approximately double the share of FWS dollars going to community colleges.
4. Support Capacity Building for Work-Based Learning. Policymakers can support capacity building for work-based learning by allowing institutions to use a larger share of their allocations to hire coordinators to place FWS students with off-campus employers. They can also consider changes to Federal Work-Study that would enable work-based learning intermediaries to boost capacity. Giving institutions more flexibility in how they use FWS dollars could allow them to partner with intermediaries to develop and scale meaningful work experiences.
5. Provide Greater Flexibility in the Use of FWS Dollars. Greater flexibility in the use of FWS dollars could allow institutions and intermediaries to innovate and align these dollars with a wider range of opportunities. Policymakers could increase FWS flexibility by streamlining the program to make it easier to apply to off-campus jobs, giving institutions room to innovate in their use of Federal Work-Study for roles that meet a higher standard, or making work-study awards portable, such that students could apply them toward a wider range of opportunities. Allowing students to take their FWS awards directly to work-based learning providers could enable those intermediaries to leverage FWS dollars toward creating quality, paid work experiences.

There is bipartisan interest in expanding access to work-based learning. Modernizing Federal Work-Study could provide more students with quality work-based learning opportunities and enable the program to support the development of new work-based models. It could also address disparities in access and give more low-income students the opportunity to benefit from meaningful career experiences.