Over the last five years, more and more companies have been insisting on college degrees for entry level jobs. At the aggregate level this might make sense if jobs are demanding more scientific knowledge or more analytical or critical thinking skills. However, a recent study by the Rockefeller Foundation and Edelman Intelligence (WSJ story here) finds educational demands by employers are rising across the spectrum. For instance in 2011, 29% of the job listings for hotel managers called for a college degree; this figure rose to 47% five years later.
Apparently the weak job market has created a surplus of college grads for positions that actually require advanced education, forcing many grads to lower their ambitions. Employers react to the new applicant pool by raising their educational standards. The Rockefeller-Edelman study raises questions as to whether this decision is really meeting employer needs. A college degree could serve as a signal for otherwise hard-to-measure communications skills. Yet companies are now complaining that they are unable to retain these overqualified workers.
Today's college graduates face a much stronger market than their counterparts five to ten years ago. If this continues, I would expect companies to start using games or psychometric evaluations to evaluate communications skills directly and stop using degree possession as a screen.
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