As higher education evolves to meet the needs of today’s diverse learners, competency-based education (CBE) is gaining traction for its student-centered approach and promises of affordability and workplace preparation. According to a 2020 survey, 128 unique institutions were operating a total of 1,057 CBE programs between 2018 and 2020, and 82% of responding institutions expected CBE programs to grow further between 2020 and 2025 (American Institutes for Research [AIR], 2021). While interest in CBE may be growing, most institutions remain in the early planning stages.
CBE programs are usually built on three fundamental elements: clearly defined competencies, proficiency-based assessment of these competencies, and flexible timeframes that allow students to progress at their own pace. Competencies are specific learning outcomes that outline the knowledge and skills students must acquire. Students must provide measurable evidence of their proficiency with the competencies through performance assessments. Flexible schedules allow students to move through courses and programs at their own pace as they achieve competency. While the first two characteristics focus on clear outcomes and assessments, the third—flexible timeframes—is what most sets CBE apart from traditional education programs that typically rely on fixed schedules and a set amount of seat time (Surr & Rasmussen, 2015).
For example, in a CBE model, two students in an online MBA program working on the competency “Develop a comprehensive business strategy using market analysis" can do so on different schedules. One student with ten years of business experience could complete a market analysis project and demonstrate competency in just three weeks by leveraging their prior experience and industry knowledge. Meanwhile, a career-changer with no formal business training might take eight weeks to build their understanding of foundational business concepts and practice market analysis before completing the project. While both students ultimately achieve the same standard, they do so on timelines suited to their unique backgrounds and abilities. In contrast, a more traditional education model would require both students to follow the same predetermined timeframe in a semester-long course, regardless of their prior knowledge or experience.
While gaining momentum, CBE is not a new model—it has deep historical roots in vocational and technical education, including military, legal, and medical training (Nodine, 2016). In the United States, competency-based models in higher education emerged in the 1960s and 1970s through innovative teacher training programs. Technological developments in advanced learning management systems have removed a previous barrier to delivering content in a self-paced format. This innovation has made it possible for institutions to deliver courses asynchronously, allowing students to learn more easily on their own schedules (Nodine, 2016).
Today, increased interest in CBE can be traced to several factors, including the rise of online education models, the economic pressure to provide lower-cost options, and a desire to reach and serve nontraditional learners with more flexible pathways (Nodine, 2016). Despite the technological progress, adoption of CBE still remains inconsistent. Many institutions have implemented only partial CBE elements in select programs, and as of 2020, very few reported an intention to adopt CBE as their primary education model (AIR, 2021). In many cases, CBE programs are seen as an additional offering to complement rather than completely replace traditional degree models.
Benefits of CBE
As students seek education that adapts to their personal commitments and career goals, CBE offers a model that is both inclusive and responsive to their needs. This approach is particularly beneficial for working students, adult learners, and individuals from underrepresented backgrounds, who may face barriers to traditional education due to time constraints, financial limitations, or the need for programs directly tied to career advancement. Recent survey data indicated that 90% of students enrolled in CBE programs were over the age of 25 and had previous job experience (Kelchen, 2015).
The hallmark flexibility in timelines, as described above, is one of CBE’s greatest benefits. One study reports that a flexible schedule is the most commonly prized factor among unenrolled adults with an associate degree or less, with 56% saying it would make them very likely or extremely likely to enroll in a program (Torpey-Saboe & Clayton, 2022). Many CBE students also report career advancement as their primary goal for enrollment, and while outcome data remains limited, early results suggest success in this area. For example, a small survey of CBE graduates found high rates of satisfaction with their career progress, including increased marketability, professional advancement, and higher earnings (Navarre Cleary, 2020). Furthermore, students in CBE programs report feeling more prepared for their careers, with over 70% of CBE students feeling career-ready, compared to just one-third of traditional students (Wang, 2015).
These career benefits may stem from CBE programs’ practical and personalized evaluation processes. Within a CBE model, there will be many opportunities for personalized formative evaluations and multiple authentic activities and assessments to demonstrate proficiency with the competencies (Gervais, 2016). For example, in a CBE program, a nursing student might practice administering IVs in a simulation, receive formative feedback to improve, and then be assessed on performing the procedure in a clinical setting once they are ready. In contrast, traditional models often require students to take written exams on a preset schedule. CBE assessments require students to demonstrate their abilities through hands-on tasks, building the confidence and practical skills essential for career success.
Ultimately, the flexibility and career focus of the CBE model underscore its potential to address broader institutional goals. The key reasons cited by institutions looking to implement CBE were a desire to reach nontraditional learners and respond to workforce needs (AIR, 2021). By expanding access and providing personalized pathways through CBE, educational institutions can foster greater equity in education while enhancing their reputation for innovation and responsiveness to diverse student populations.
Challenges of Implementing CBE
While the benefits of CBE are significant, implementing this model is not without challenges. At an institutional level, full implementation of CBE may require rethinking many core aspects of operations. Under Title IV of the Higher Education Act, federal financial aid is primarily based on the number of credit hours a student is enrolled in, making the credit hour a foundational unit for higher education. As CBE programs aim to move away from preset time frames, this presents a significant challenge to implementation in a way that maintains federal aid eligibility (Postsecondary National Policy Institute [PNPI], 2022). CBE programs must often map their programs to credit hours and standard academic calendars, adding substantial administrative work (Center for Higher Education Policy and Practice [CHEPP] & American Institutes for Research [AIR], 2023). Institutions must also ensure they continue to comply with accreditation requirements and earn the trust of employers to fully realize the value of their course and program offerings.
Since 2005, there have been attempts to ease the administrative load of mapping credit hours by making room for alternative CBE frameworks within federal guidelines (Online Learning Consortium [OLC] et al., 2019). For example, in 2019 the U.S. Department of Education updated regulations to allow for recognition and financial aid funding of direct assessment CBE programs without credit or clock hour measures with prior approval by the relevant accreditor and Department of Education (Competency-Based Education Network [C-BEN] & American Association of Collegiate Registrars and Admissions Officers [AACRAO], 2023). A direct assessment program is one in which student progress is measured solely by determining that a student has command of the relevant competencies (as opposed to translating their efforts into standard credit hours). Currently, to qualify as a direct assessment program, programs must meet certain criteria, such as providing sufficient educational resources and substantive interactions with instructors (Office of Postsecondary Education, 2025). As legislation continues to evolve around these programs, institutions will want to consult the most recent available guidance for insight into the implications of a CBE format for financial aid eligibility and accreditation compliance. Upgrading technology architecture for CBE implementation can be costly but may ultimately support and streamline the tracking of many necessary metrics for regulatory compliance, such as enrollment status, equivalent credit hours, financial aid disbursement, and satisfactory academic progress (C-BEN & AACRAO, 2023).
In addition to logistical challenges, implementing CBE also presents cultural obstacles. The traditional U.S. education model has deep roots and history, and many faculty, students, administrators, and employers have long-held expectations that may conflict with CBE. Concerns can often arise around maintaining academic rigor, ensuring consistency in grading, transferability between institutions, and the future acceptance of credentials by employers (PNPI, 2022). Additionally, while students widely praise the flexibility of CBE programs, the less structured format may not be appropriate for all learners. Research indicates that students who opt for CBE have a strong preference for flexibility, but younger or less intrinsically motivated individuals may have more difficulty adapting to this model (Wang, 2015). Clear communication with potential students and partnerships with employers in the relevant industries can help address concerns and misconceptions about the CBE model and ensure a proper fit (Wang, 2015).
Conclusion
As the landscape of higher education continues to evolve, competency-based education stands out as a model with the promise to meet the demands of a rapidly changing job market and diverse student populations. With its flexibility and performance-based assessments, CBE is an approach that prioritizes skill acquisition and adaptability, essential for lifelong learning and workforce readiness. Despite the challenges, CBE offers higher education a chance to be both innovative and inclusive as it has the potential to better serve nontraditional and underserved students.
References
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Center for Higher Education Policy and Practice (CHEPP), & American Institutes for Research (AIR). (2023, July). Postsecondary CBE: A primer for policymakers.
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Kelchen, R. (2015). The landscape of competency-based education: Enrollments, demographics, and affordability. American Enterprise Institute.
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Online Learning Consortium (OLC), University Professional and Continuing Education Association (UPCEA), & WICHE Cooperative for Educational Technologies (WCET). (2019). Competency-based education, direct assessment, and financial aid: Background, concerns, and guiding principles.
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Surr, W., & Rasmussen, J. (2015). Partners in crafting competency-based pathways to college and career readiness. In Great Lakes and Midwest Regional Deeper Learning Initiative. American Institutes for Research.
Office of Postsecondary Education (OPE). (2025, January 14). Direct assessment (competency-based) programs. U.S. Department of Education.
Wang, J. (2015, September). The student perspective on competency-based education: Qualitative research on support, skills, and success. Young Invincibles.