It is no secret that a degree these days is not worth what it used to be. Whereas in generations past a high school diploma could get you well on your way towards a supervising position on a production line, for example, you now need a bachelor’s degree. And many jobs that used to require a bachelor’s degree now require a master’s degree or more.
This trend of ever-increasing credential requirements is known as degree inflation, and it has powerful drivers on both the supply and demand sides of the labor market. More young people than ever are seeking a college education to showcase their readiness for work, flooding the U.S. labor market with degrees. And while unemployment is currently low, the effects of the 2008 recession still linger – when there were far fewer job openings for far more people, employers used degree requirements as a way to filter down their applicant pools. Many of these requirements never went away: in many fields, the percentage of employees with a degree is grossly lower than the percentage of job postings for those positions requiring a degree. In other words, plenty of people who are already working in these industries do not have degrees, but you are going to need a degree in order to join them.
There are many reasons why so many young people are choosing to get a degree these days, but one of the biggest is an ongoing shift in the way we look at college education: in an ever-more competitive society, degrees are increasingly seen as proof of a strong work ethic. Employers no doubt see it the same way, given their propensity to use education as a proxy for candidate quality. This may well be accurate, but it begs the question: is proving one’s ability to work hard really sufficient reason to spend tens of thousands of dollars on an education? Would not someone who goes to college only to signal his strong work ethic be better off doing something more productive with those years? And would not his spot in class be better used on someone who really does need a degree in order to succeed?
The truth is that a considerable amount of degree inflation is driven by students who get bachelor’s degrees knowing full well that they will not need most of that knowledge for their work – these include future blue-collar workers and their supervisors, secretaries, and clerks, to name a few. This creates a self-fulfilling cycle where many applicants to these positions do have bachelor’s degrees under their belts, reinforcing the notion that the degree is in fact a requirement. Under the pressure of competition exacerbated by degree inflation, these people feel compelled to spend enormous sums of money on four-year schools when in reality they would be far better off at two-year and vocational schools.
The outlook seems grim, but a significant shock to this part of the labor market could be enough to make it snap out of this irrational and damaging cycle. As it happens, there exists a great way to inject the market with thousands of optimally educated workers, all while reducing the number of students in college for pointless four-year degrees: free two-year postsecondary education.
In addition to the obvious benefits to low-income students and their families, free two-year and vocational schooling would cause many would-be four-year students to substitute towards degrees that are more applicable in their fields of work. This would create more room in four-year universities, reduce the cost of private postsecondary schooling through competition, and throw a stick in the spokes of degree inflation.
What is more, this kind of proposal is politically feasible to a surprising extent – Tennessee, under Republican leadership, became the first state to offer free two-year schooling to recent high school graduates in 2015. In 2017, they extended that right to all adults. The results of the Tennessee experiment remain to be seen, but it provides concrete proof that such a model can be implemented and funded with relative ease.
Degree inflation will likely never go away completely, but there is no reason to resign ourselves to it. With the right policy choices, states have the potential to ameliorate the problem while boosting the competitiveness of their workforces. And while free two-year schooling may be a long way off in some localities, there are other tools available and cheaper steps that can be taken in the meantime – improved access to vocational training in high schools, for example. We might be in the habit of overeducating some and undereducating others, but achieving the right balance might just be easier than we think.