Understanding the New National Talent Strategy

The Bipartisan Policy Center's Commission on the American Workforce has unveiled a comprehensive blueprint titled "A Nation at Risk to a Nation at Work: The Case for a National Talent Strategy." Released on March 11, 2026, this report, co-chaired by former Tennessee Governor Bill Haslam and former Massachusetts Governor Deval Patrick, addresses the fragmented federal approach to education and workforce development. With over $250 billion spent annually across more than 150 programs spanning a dozen agencies, the lack of coordination has left the U.S. struggling to meet workforce demands in an era of rapid technological change.

At its core, the strategy seeks to align federal investments with state and local innovations, empowering community colleges, universities, and employers to create clear pathways from education to employment. This bipartisan effort draws on input from 24 commissioners, four working groups, and over 50 experts, positioning higher education institutions as pivotal players in building a competitive talent pipeline.

Why Higher Education Needs This Strategy Now

America faces a profound skills mismatch exacerbated by artificial intelligence (AI) and automation. One-third of job skills shifted between 2021 and 2024, with McKinsey projecting that 57 percent of U.S. work hours could be affected by late 2025. Only 61 percent of students entering undergraduate programs complete a degree or credential within six years, leaving 37.6 million adults under 65 with some college but no credential. Half of bachelor's degree holders from 2012-2021 were underemployed a year post-graduation, rising to nearly three-quarters after a decade.

Enrollment among recent high school graduates dropped from 69 percent in 2018 to 62 percent in 2021, while 12th-grade math scores on the National Assessment of Educational Progress (NAEP) hit their lowest since 2005. Gallup polls show confidence in college's value plummeting from 75 percent in 2010 to 35 percent today. Higher education must pivot to outcomes-focused models to bridge these gaps, particularly in AI, STEM (Science, Technology, Engineering, Mathematics), and middle-skills jobs projected to require 72 percent postsecondary credentials by 2031.

Core Components of the Proposed Talent Advisory Council

Central to the blueprint is the creation of a Talent Advisory Council within the Executive Office of the President, modeled after the National Security Council. Chaired by the president and including secretaries from Commerce, Defense, Education, Health and Human Services, Homeland Security, and Labor—plus the Council of Economic Advisers and Office of Management and Budget—this body would coordinate policy, funding, and data. It would produce an annual U.S. Talent Report on readiness metrics and audit federal structures for alignment.

For higher ed, this means streamlined federal support, reducing silos that hinder universities from responding to local employer needs. As former U.S. Secretary of Education Margaret Spellings noted, "We don’t need a bigger federal role—we need a smarter one."

Revolutionizing Funding Through Outcomes-Based Grants

The report proposes replacing patchwork programs under the Higher Education Act (HEA, last reauthorized 2008), Workforce Innovation and Opportunity Act (WIOA, 2014), and Perkins with flexible, outcomes-based talent grants. States would enter performance agreements with the federal government to scale "credentials of value"—those yielding employment, earnings premiums, and career advancement for working-age adults.

This shift empowers states to partner with community colleges and four-year institutions, prioritizing metrics like job placement over enrollment headcounts. Protecting and modernizing the Pell Grant, including Workforce Pell expansions, would support shorter-term programs, but only with robust data infrastructure. Title IV regulations would evolve to embrace competency-based education (CBE), prior learning credits, and accelerated pathways, moving beyond seat-time proxies for quality.

Community Colleges: The Frontline Workforce Engines

Community colleges stand to benefit most, serving as regional hubs for adult learners, veterans, working parents, and underprepared students. Texas House Bill 8 exemplifies performance-based financing, rewarding credentials that recoup costs within 10 years and offer earnings premiums. Eloy Ortiz Oakley, president of the College Futures Foundation, emphasized: "Giving states more flexibility through outcomes-based talent grants would allow them to work more directly with community colleges and employers."

These institutions could expand stackable credentials aligned to local demands, such as AI-assisted manufacturing or healthcare tech, fostering partnerships with industry for apprenticeships and work-based learning.

Photo by Jon Tyson on Unsplash

Four-Year Universities and Research Institutions Adapt

Research universities and four-year colleges must integrate workforce alignment into curricula, validating skills via updated O*NET frameworks refreshed with real-time employer data and AI crosswalks. Portable Learning and Employment Records (LERs) would allow seamless credit transfer from work, military, or life experience.

Georgia State University's predictive analytics doubled graduation rates, shaved a semester off time-to-degree, and cut debt by 20 percent—models scalable nationwide. Universities could leverage this for faculty roles in interdisciplinary AI-STEM programs, competing on outcomes to attract federal grants.

Leveraging Data Systems for Student Success

A national Talent Data System would link federal, state, K-12, postsecondary, and workforce data, creating consumer portals like Arkansas's LAUNCH for job-aligned program choices. Privacy-protected AI analytics would personalize advising, echoing California's Cradle to Career system.

Higher ed institutions gain tools to track alumni earnings, refine programs, and support navigation—crucial as half of labor markets face 50 percent middle-skills mismatches by 2031, hitting Black, Latino, Native American, and rural populations hardest.

Expert Perspectives and Stakeholder Reactions

Bill Haslam stated: “States and employers are already innovating, but without a strategy... we will fall further behind.” Inside Higher Ed notes bipartisan appeal amid AI booms, though partisan distractions like culture wars persist. Community college leaders praise flexibility, while universities eye research boosts akin to CHIPS and Science Act's 2 million reshored jobs.

Employers via LinkedIn's Economic Graph expand talent pools 20-fold with skills-first hiring, urging higher ed to validate non-degree credentials.

Real-World Case Studies Driving Change

• Texas HB8: Outcome funding boosted community college completions in high-demand fields.
• Alabama Talent Triad: Aligns credentials to in-demand jobs, approving only those meeting employer standards.
• Kentucky KYSTATS: Unified data reveals skills gaps, guiding program development.
• Georgia State: AI advising transformed retention for diverse students.

These models illustrate scalable impacts, with higher ed poised to replicate via federal-state pacts.

Challenges Ahead and Potential Hurdles

Implementation faces congressional hurdles—reauthorizing HEA/WIOA—and resistance to outcomes metrics fearing underfunding for equity. Data privacy, AI biases, and rural access remain concerns. Yet, fiscal responsibility via audits promises sustainability.

Photo by Kelly Sikkema on Unsplash

Future Outlook: A Competitive Talent Pipeline

By 2031, 30 million more high school grads and 37.6 million adults need reskilling. The strategy positions higher ed as innovation hubs, blending academia with industry for AI fluency and lifelong learning. Explore higher ed jobs aligning to these shifts or career advice for navigating new pathways.

Congress must act, governors commit, and institutions adapt—unlocking opportunity for all.

Actionable Steps for Higher Ed Leaders

1. Assess programs against local labor data.
2. Pilot CBE and LERs.
3. Forge employer partnerships for apprenticeships.
4. Advocate for state talent grants.
5. Invest in AI advising tools.

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