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Over the past year, the value of blockchain\u2019s most notorious application, Bitcoin,\u00a0soared<\/a>from $20 billion to over $300 billion before halving again. Since before that rollercoaster ride, blockchain enthusiasts have touted the technology\u2019s potential for solving longstanding problems in a wide array of fields. But what could it have to offer for education and labor policy?<\/p>\n That question brought together all kinds of experts \u2013 from ed-tech outfits to college staff to policy wonks \u2013 at a convening organized by the Lumina Foundation in Indianapolis last fall. Together, we grappled with the possible uses and overall utility of the technology in America\u2019s education and employment markets.<\/p>\n Before that, of course, most of us had to confront an obvious question.<\/p>\n Blockchain is a record-keeping system comprised of a continuously growing list of data batches called blocks. The most recent block serves as a ledger of each user\u2019s current resources; the set of all blocks ever written (the blockchain) contains the whole history of transactions made by users.<\/p>\n Each block\u2019s connection to its predecessor is secured with\u00a0public-key cryptography<\/a>,\u00a0the same type of protocol your computer is using to securely access this website right now. In a blockchain application, public-key cryptography allows users to validate that other blockchain users actually have the resources they say they do, while\u00a0making it practically impossible to tamper with a previous block of data without\u00a0raising alarms<\/a>. But unlike the central database that stores this webpage\u2019s digital content, a blockchain is a decentralized or \u201cdistributed\u201d data store, where each user of an application automatically downloads a copy of that application\u2019s blockchain. On a public blockchain like Bitcoin (blockchains can also be private), each new block of records must be validated by a majority of users; to add a fraudulent new block, you\u2019d have to hack at least half of the devices with a copy of that blockchain in the space of a few minutes or even seconds.<\/p>\n This is the source of optimists\u2019 greatest hopes for blockchain technology: security and authenticity without a central authority, the thinking goes, means blockchain users can have complete ownership of their information. But what would that look like when applied to the worlds of education and employment? And who, in practice, would blockchain technology help?<\/p>\n For the moment, possible uses for blockchain in education and employment center on two objectives: increasing the shareability of educational credentials and enabling workforce collaboration between competing employers.<\/p>\n Credentials are built on trust, and to establish it, most credentials still depend on a central authority. For degree credentials, that authority is the college registrar. Anybody can claim to have a degree; to be sure it\u2019s real, institutions and employers have few choices but to ask for a sealed envelope from the registrar\u2019s office containing a raised-seal transcript or proof of graduation.<\/p>\n Blockchain applications could change that. Last summer, MIT offered several hundred graduates\u00a0the option of receiving a digital diploma in addition to a paper one<\/a>. Using a\u00a0Blockcerts wallet app<\/a>\u00a0on their smartphones, these graduates can instantly share an MIT-verified digital diploma with a prospective employer or educational institution \u2013 without contacting the registrar\u2019s office, and without MIT having to maintain a publicly accessible diploma database.<\/p>\n Blockchain has been proposed as a solution for a problem on another side of the hiring process, too. Especially in industries with stiff competition for talent, employers are wary of sharing details about the specific skills they need and the strategies they use to find applicants who have them \u2013 even though sharing that information might help institutions, industry associations, and training providers supply better-aligned educational programs. This careful secrecy is an example of a\u00a0collective action problem<\/a>, where individuals forgo actions that would provide overall benefits to the group \u2013 in this case, providing more transparency around hiring and training practices \u2013 for fear of consequences that would affect them individually.<\/p>\n Collective action problems like these are particularly amenable to blockchain applications, writes\u00a0Christopher Mims in the Wall Street Journal<\/a>. By using blockchain technology to anonymously share data on the competencies and training they require for different occupations \u2013 either through a private community of practice or a broader public jobs registry \u2013 employers could help training providers scale up effective training practices without showing their hand to competitors, and without individual institutions having to go door-to-door to different employers for input on needed skills. The\u00a0Talent Pipeline Management (TPM) initiative<\/a>, organized by the US Chamber of Commerce Foundation and the George Washington Institute of Public Policy and presented at the Lumina convening last fall, proposes using blockchain technology to enable this kind of sharing.<\/p>\n A common criticism of blockchain technology is that it is a new hammer for the same nail or, less generously, a solution in search of problems. For conventional degrees at least, blockchain is probably the wrong hammer for now.<\/p>\n Blockchain implementation can be expensive and time-consuming, and even if an institution goes all-in on blockchain credentials, there\u2019s no guarantee that other institutions or their graduates\u2019 prospective employers will accept them. And as with email passwords, human users are the weakest link in blockchain security. If graduates aren\u2019t instructed in safety and best practices for blockchain credentials, the credentials could be even harder to use \u2013\u00a0and possibly less secure \u2013 than a paper diploma or transcript.<\/p>\n The blockchain case for certain non-degree credentials is stronger, however. Proponents of open-source digital credentials like Open Badges are\u00a0optimistic<\/a>\u00a0about\u00a0enhancing the standard with blockchain technology<\/a>, and occupational credentials like licenses and certifications could benefit, too, by adapting blockchain features already in use as\u00a0smart contracts<\/a>. That would enable issuers to automatically update or revoke employee permissions when credentials elapse or when a new training protocol is rolled out.<\/p>\n Even better, data sharing schemes like TPM could revolutionize the way employers engage with the education sector to recruit and hire talent. Though the first beneficiaries would be employers, TPM\u2019s leaders also envision a comprehensive labor market information system that could securely connect data about credentials, occupations, and individual learners to support policymakers in channeling public dollars towards programs and providers with the best outcomes.<\/p>\n Still, any benefit \u2013 to employers or to policymakers \u2013 will depend on employer buy-in. While blockchain technology offers an elegant solution for securely sharing occupational data, few employers are likely to go through the trouble without a convincing proof-of-concept.\u00a0A pilot program to see if blockchain technology can really enable better employer collaboration on workforce and education issues could be a worthy target for public investment. Hot-button sectors like cybersecurity or advanced manufacturing would be especially ripe for experimentation.<\/p>\n But though the theoretical benefits of blockchain technology to employers and policymakers are clear enough, any proposal or pilot should be careful to keep American workers\u2019 interests in mind. Unless blockchain applications make it easier for individual Americans to successfully navigate our complex education and job markets, the technology will only amount to a solution that causes more problems.<\/p>\n","protected":false},"excerpt":{"rendered":"What is Blockchain technology?<\/b><\/h4>\n
Blockchain application in education and labor markets<\/b><\/h4>\n
But will it help?<\/b><\/h4>\n