The number of unique credentials available in the U.S. has hit a whopping 1.8 million, with digital badges making up more than a million of those offerings, according to the latest report from Credential Engine.

The report, released Tuesday, is the fifth in a series tracking the ever-growing variety of credentials and providers cropping up across the country. Much has changed since the last “Counting Credentials” report came out in 2022. Credential Engine, a nonprofit dedicated to charting the credentialing landscape, improved its data collection and analysis strategies to remove duplicate programs from data samples and include more badge programs, allowing for more accurate counts and estimates, the new report noted.

Researchers found that 134,491 credential providers—including colleges and universities, online course providers, nonacademic organizations, industry associations, and state governments—are producing 1,850,034 credentials, up from the 1,076,358 they counted in 2022. The report also found that education institutions, federal and state governments, and employers spend $2.34 trillion annually on these programs.

Credential Engine identified 1,022,028 badges and 486,352 certificates among the total. Degrees, by comparison, made up a smaller fraction of the credentials tallied this year: 264,099 programs. The number of secondary school diplomas and occupational licenses followed behind at 52,948 and 14,331, respectively. Certifications, which require an exam and tend to expire, reached 6,892. And the organization found 3,384 microcredentials, defined by the report as any program offered by a massive open online course provider that embraces the label.

Scott Cheney, CEO of Credential Engine, said the standout finding to him is “there’s a lot of digital badging being done,” a trend he finds “really exciting.” He believes digital badges, which recognize specific skills and achievements for display online, allow workers to better showcase their learning at a more granular level. For example, badges, whether offered by academic or nonacademic providers, can recognize skill sets ranging from emotional intelligence to mastery of a coding language, or even completion of a class or work project.

Badges are “being used to recognize smaller and smaller learning activity and skill attainment,” Cheney said. “We’re really seeing a moment when we’re able to actually count all learning,” which helps job applicants “tell their story.”

He said the digital format not only makes it easier for learners to keep track of everything they’ve achieved but also simplifies sharing that information with employers.

A companion report, released with the credential count, suggests innovations like digital wallets and learning and employment records, which can house collections of digital credentials, are making badges more shareable and verifiable for employers.

“The technology is there,” Cheney said.

He also believes the ascent of skills-based hiring is driving the trend. More than half of states have adopted policies to encourage hiring according to skills, not degrees, and a slew of employers have embraced the approach. He’d like to see more employers with these goals use digital credentials to assess what candidates bring to the table.

Because of these recent developments, “all of a sudden, we need ways to actually unpack the skills that you have in a traditional degree or certificate or certification” and to offer ways to learn and prove mastery of “a single skill,” he said.

Though the report doesn’t delve into it, he noted that traditional higher education institutions are increasingly interested in offering nondegree credentials, which he believes is “healthy for them and their relationship with their students” as demand for such programs ramps up.

But Cheney also understands colleges’ trepidation about entering a nondegree credential landscape that’s crowded, “very chaotic” and “difficult to navigate.” He acknowledged that some academics have healthy concerns about the quality of proliferating nondegree credentials as nonacademic credential providers grow their offerings at fast clip. The trend “does cry out for … a greater need to have reliable outcome data and impact data,” he said. Members of the committee engaged in the negotiated rule-making process for Workforce Pell, a new federal financial aid option for short-term job training programs, are wrestling with such questions about how to ensure credentials’ quality this week.

Nondegree credentials aren’t “going to be right for every institution, and that’s OK, too,” Cheney said. “We need some that are still going to be very traditional … because the economy needs that as well.” At the same time, higher ed institutions “need to recognize where the marketplace is, where the zeitgeist is in the country and what employers need and what students are calling out for.”