The vocational shift in post-secondary education markets
Trade school enrollment is climbing, federal funding for career and technical education is expanding, and forthcoming Title IV rule changes under the One Big Beautiful Bill Act are poised to reshape vocational training M&A heading into 2026.
Rising skepticism about the return on investment of a traditional four-year degree, combined with expanding federal funding for career and technical education, has made vocational training one of the most structurally attractive segments in the broader education market. The industry is projected to approach $18 billion in revenue by 2029, and a rebound in M&A activity — together with forthcoming policy changes under the One Big Beautiful Bill Act — is creating a compelling environment for continued consolidation.
Between 2020 and 2025, trade school enrollment rose 4.9% while university enrollment declined 0.6%. Federal funding under Perkins V grew from $1.24 billion in 2019 to $1.42 billion in 2025 — the first sustained increase in over a decade. And 2024–2025 deal volume has rebounded sharply from 2023 lows, with strategic acquirers and private equity sponsors competing for platforms that deliver measurable workforce outcomes.
In this update, we examine the forces shaping capital flows across the vocational training sector — from shifting consumer perceptions of college ROI and accelerating federal investment to pending Title IV rule changes that could reopen the sector to private equity in 2026.
Sector at a glance
The postsecondary vocational education industry spans a diverse set of institutions, programs, and services designed to equip individuals with job-ready skills and credentials beyond high school. Also known as career and technical education (CTE), vocational training covers fields including construction, HVAC, information technology, allied health, transportation, and beauty and wellness. Delivery formats range from traditional trade schools and certificate programs to apprenticeships and online platforms offering short-term credentials — frequently combined in hybrid, competency-based models calibrated to learner needs.
The industry is evolving in response to shifting labor market demands, increased appetite for affordable education options, and a growing employer emphasis on skills-based hiring. Employers increasingly value practical experience and industry-recognized credentials over traditional degrees, prompting providers to align curricula with workforce needs. Learners, in turn, are seeking flexible, outcome-oriented programs with clear pathways to employment. These dynamics — combined with accelerating innovation in program formats and industry partnerships — position postsecondary vocational education as a pragmatic alternative to the four-year degree.
Expected market growth
The U.S. vocational education market is projected to reach nearly $18 billion in revenue by 2029, growing at a 1.3% CAGR from 2024. Growth is supported by the rising appeal of vocational careers, which typically require less than a year of training, carry average tuition below $15,000, and lead to stable employment in high-demand trades. Healthcare remains the dominant subsegment, accounting for 52% of the 1.4 million postsecondary CTE enrollments tracked by the National Center for Education Statistics. Maintenance and repair trades (21%), multi-specialty institutions (16%), and adult education/vocation programs (5%) round out the largest categories.
Return on investment & degree comparison
For many prospective students, the math increasingly favors a skilled trade. Research from the Federal Reserve Bank of New York indicates that one in four college graduates earns only 2.6% more over their lifetime than individuals whose highest credential is a high school diploma. Analysis from the Foundation for Research on Equal Opportunity found that while engineering, computer science, and nursing degrees often yield multi-million-dollar lifetime returns, humanities fields such as psychology, art, and religion can generate little or even negative net value.
A 2025 Georgetown Center on Education and the Workforce ranking of more than 4,600 institutions found that certain for-profit, certificate-granting vocational schools ranked in the top 10% overall for 10-year ROI — despite shorter program lengths and substantially lower tuition costs. The reason: early workforce entry plus compound investment can take decades for a delayed-entry professional to offset, even in fields with high long-term earning potential.
Federal funding is expanding for the first time in a decade
Federal investment in career and technical education is broadening. The Strengthening Career and Technical Education for the 21st Century Act — commonly known as Perkins V — supports CTE programs nationwide, helping schools modernize equipment, strengthen industry partnerships, and broaden access. Funding has grown from $1.24 billion in 2019 to $1.42 billion in 2025, a roughly 2.2% CAGR and the first sustained increase in over a decade. Through Perkins V and adjacent vehicles — including Title IV federal student aid, the Workforce Innovation and Opportunity Act, the GI Bill and Veterans Education Benefits, and other workforce grants — students have multiple pathways to finance training for high-demand occupations in skilled trades, healthcare, and technology.
Enrollment profile & special populations
The postsecondary CTE population is demographically diverse, with women representing 54% of the 1.8 million concentrators tracked federally. A substantial share come from economically disadvantaged families (41.8%) or are preparing for careers in nontraditional fields for their gender (19.6%) — underscoring the sector’s role as a pathway to economic mobility.
| Postsecondary CTE Concentrators by Special Population | Total Students | % of Enrolled |
|---|---|---|
| Individuals from Economically Disadvantaged Families | 757,506 | 41.8% |
| Individuals Preparing for Nontraditional Fields | 354,215 | 19.6% |
| Single Parents | 110,500 | 6.1% |
| Out-of-Workforce Individuals | 85,427 | 4.7% |
| Individuals with Disabilities (ADA) | 84,379 | 4.7% |
| English Learners | 64,712 | 3.6% |
| Youth with Parent in Active Military | 12,859 | 0.7% |
| Youth in Foster Care | 7,966 | 0.4% |
| Homeless Individuals | 7,118 | 0.4% |
| Other | 326,642 | 18.0% |
| Total | 1,811,324 | 100.0% |
M&A trends & drivers
Deal volume in education and training M&A has shown cyclical volatility over the past two years. Activity declined steadily through 2023, bottoming at just seven transactions in Q4 — a reflection of broader macroeconomic uncertainty and tighter capital markets. 2024 marked a sharp rebound, with 20 transactions in Q2 alone, driven by sustained demand for job-aligned, skills-based training in healthcare and the skilled trades. First-half 2025 activity moderated slightly but remained well above 2023 levels, pointing to greater market stability.
Among North American transactions, strategic acquirers accounted for 42% of deal activity, followed by PE-backed strategics (38%) and pure-play financial sponsors (20%). The composition reflects continued buyer interest in platforms with scalable delivery models, recurring revenue streams, and measurable workforce outcomes. With structural labor shortages persisting across skilled trades and workforce development remaining a bipartisan policy priority, the sector continues to attract long-term capital from a diverse acquirer universe.
Pending Title IV reform could reopen the sector to private equity in 2026
Recent changes to Title IV under the One Big Beautiful Bill Act, together with a pending negotiated rulemaking process, are poised to reshape the vocational training M&A landscape through 2026. Notable among the proposed changes: revisions to PPA signature rules and a streamlined change-of-control approval process — both of which could re-open the sector to private equity participation after years of regulatory friction.
Parallel discussions on Pell eligibility, Workforce Pell, gainful employment, and financial value transparency are expected to provide further clarity for investors. Under emerging earnings-data thresholds (a possible successor to gainful employment), institutions must demonstrate that graduates earn more than individuals who did not complete a program in order to retain federal aid eligibility. The Department of Education’s “Do No Harm” proposal, released in Q4 2025, would flag postsecondary institutions that fail to deliver pathways to earnings above a high school diploma — enhancing transparency for applicants during the enrollment process.
The underlying earnings data will likely require adjustments for specific circumstances — cosmetology’s significant tip-income base, fully online institutions, non-completer cohorts, and regional variation — before thresholds take effect. Once those issues settle in mid-2026, a meaningful uplift in vocational training M&A activity is likely.
Notable transactions
Two representative transactions from the past year illustrate the themes driving vocational sector consolidation: financial sponsor interest in short-duration trades platforms, and strategic roll-ups in utility and skilled-labor training.
Argosy Capital recapitalized Heavy Equipment Colleges of America (HECOA), a leading provider of heavy equipment, crane, and directional drill training. HECOA’s three-week training programs and associate degree programs combine classroom instruction with immersive, on-site training to prepare students to operate machinery including bulldozers, excavators, cranes, and backhoes.
The partnership with Argosy will support HECOA’s planned program expansion and new offerings, extending the company’s reach to a broader population of learners seeking impactful career changes — and reinforcing the platform thesis that short-duration, high-placement-rate vocational programs are among the most economically efficient pathways to middle-income employment.
Cotulla Education acquired American Lineman College, an electrical line-working and climbing school based in Bakersfield, California. American Lineman College has graduated hundreds of pre-apprentice line workers and utility workers, with placement rates above 90% and graduation rates above 85% — metrics that reflect its blend of rigorous online instruction and hands-on field training.
The acquisition adds line-working education to Cotulla’s program portfolio, directly addressing structural skilled-labor shortages in U.S. utility infrastructure. With Cotulla’s scale and resources behind it, American Lineman College is positioned to expand apprenticeship completion rates and support utility HR departments seeking trained, work-ready talent.
Buyer universe
Our team has long-standing relationships with many of these firms through recent transactions in the Education and Training industry. We have also tracked buyers that have been highly acquisitive across vocational and technical workforce training. Our sector expertise and network provide us with unique insights into the buyer universe and the growth drivers that matter to them.
Navagant case studies
Representative transactions from Navagant’s vocational and technical workforce training practice — each illustrating how the firm’s sector expertise translates into life-changing outcomes for founders, management teams, and the students they serve.
Heavy Equipment Colleges of America
Background
Heavy Equipment Colleges of America (HECOA) is a leading provider of heavy equipment, crane, and directional drill training, equipping students with hands-on skills to operate bulldozers, excavators, cranes, and backhoes. HECOA’s three-week training programs and associate degree program combine classroom instruction with immersive on-site training, with campuses spanning Georgia, California, Oklahoma, and Washington.
Since Evolution Capital’s investment in 2015, HECOA delivered consistent growth and profitability, expanded its West Coast presence and onto Joint Base Lewis McChord, and built strategic institutional partnerships — establishing itself as a trusted source for blue-chip infrastructure talent pipelines with leading graduation and placement rates.
Process Highlights
Navagant served as exclusive sell-side advisor, running a targeted process to identify a partner with both the capital and the operational expertise to execute HECOA’s planned expansion into new geographies and training verticals. The process culminated in a recapitalization by Argosy Private Equity.
The transaction positions HECOA to scale its short-duration, high-placement-rate programs to reach a larger population of career changers — reinforcing the thesis that allied trades education is among the most economically efficient pathways into middle-income employment.
Ogle School
Background
Founded in 1973, Ogle School is the largest provider of cosmetology and esthetics education in Texas, operating nine campuses across the Dallas, Houston, and San Antonio metro areas and graduating roughly 2,000 students annually. Its student population reflects a clear social-mobility mission: more than 80% of students are aged 19–33, 70% are Black or Hispanic, and 50% earn less than $10,000 per year entering the program.
After significant growth under prior ownership by NCK Capital and Greyrock Capital Group, the Company sought a growth-focused equity investor to expand market share and bring cosmetology and esthetics education to a broader minority population across the U.S.
Process Highlights
Navagant advised Ogle School on its change-of-control sale to RLJ Equity Partners, a Bethesda-based private equity firm whose thesis aligned tightly with Ogle’s social-impact mission and geographic expansion ambitions. The process surfaced a partner capable of scaling the platform while preserving its student-first culture.
Post-close, Ogle is positioned to add school locations and invest in people, academic programs, technology, and facilities — extending a value proposition that enables graduates to increase their salaries 3× to 5× relative to pre-enrollment earnings.
Meet the team behind this report
With over two decades of experience, Jacob is a Managing Director and Co-Founder of Navagant, having played a vital role in establishing the firm’s brand presence and client relationships. He has earned recognition as a leader in the education and training industry. Jacob began his career at Rabobank International before focusing on software and direct marketing industries with Andersen Corporate Finance LLC. In 2003 he founded Capstone Partners and led their Education and Training Practice until 2023, when he co-founded Navagant.
Shawn is a Managing Director and Founding Member of Navagant with over 18 years of investment banking experience. Formerly, Shawn was with Raymond James investment banking, where he focused on deal execution and client development for both public and private companies. He has led execution efforts on 70+ transactions resulting in more than $3.5 billion of proceeds for clients. Shawn’s previous experience includes serving as an officer in the U.S. Navy — as a destroyer navigator and communications officer, student naval aviator, and fleet Tomahawk cruise missile officer.
Caleb is a Vice President at Navagant. Previously, Caleb was an Associate at Capstone Partners’ Education and Training practice. Prior to Capstone, he was an Analyst at Carr, Riggs, and Ingram Capital Advisors, the investment banking subsidiary of a Top-20 regional accounting firm. He holds a BBA in Financial Management from Charleston Southern University.
Cherry is an Associate at Navagant. Prior to Navagant, she was an Analyst in Capstone Partners’ Education and Training practice. Cherry is keen on learning about the financial markets. She has interned at Allied Millennial Partners as an investment banking analyst and at Shenzhen Stock Exchange as a fixed income analyst.
Endnotes & sources
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- Validated Insights. Trade Schools Report: Trends in October 2024. Oct. 2024.
- U.S. Department of Education, Office of Career, Technical, and Adult Education. State Formula Grants — State Allocations. cte.ed.gov.
- Blumenthal, S., McGrath, M., & Tetzlaff, N. Effect of Changes to Title IV of the Higher Education Act in the One Big Beautiful Bill. Ropes & Gray on JD Supra, August 2025.
- Ma, Jennifer, et al. College Benefits and Costs: Student Perceptions and Data Realities. College Board Research, Feb. 2025.
- U.S. News & World Report. See the Average College Tuition in 2024–2025. 2025.
- College Tuition Compare. 2025 Average College Tuition.
- National Student Clearinghouse Research Center. Current-Term Enrollment Estimates.
- McCormack, Kayla. How Much Trade School Costs and How to Pay for It. SoFi Learn, Jan. 2025.
- U.S. Bureau of Labor Statistics. Fastest-Growing Occupations — Employment Projections (Table 1.3). Apr. 2025.
- Johnson, Richard K. When College Might Not Be Worth It. Liberty Street Economics, Federal Reserve Bank of New York, Apr. 2025.
- Cooper, Preston. Is College Worth It? A Comprehensive Return-on-Investment Analysis. FREOPP, Oct. 2021.
- Zhang, Frank. Ranking 4,600 Colleges by ROI (2025). Georgetown Center on Education and the Workforce, Feb. 2025.
- Personal Finance Club. personalfinanceclub.com.
- PitchBook Professional Platform, PitchBook Data, Inc.
- Bolt. Education M&A Heats Up: M&A Trends and Implications for Leaders in 2025. 2025.
- Summerville, Abigail, et al. Dealmakers in Wait and See Mode, Expect M&A Pace to Pick up Later in 2025. Reuters, Mar. 2025.