Americans May Get Behind Dropping Degree Requirements, But Employers and Hiring Managers Continue to Support ‘Paper Ceiling’

However, removing degree requirements alone will not dismantle deep-seated stereotypes about what constitutes a skilled worker. Our 2024 Graduate Employment Report found that 79% of employers believe a degree still has value for an entry-level worker looking to join their company, and 70% say a degree is a strong indicator of career readiness.

While higher education is undoubtedly a viable pathway to lifelong employment, we need to strike the right balance between maintaining the value of higher education while breaking down the systemic barriers of the paper ceiling to create a labor market more fair. While a four-year degree will continue to be valuable to many, only about 40 percent of Americans hold one. Expanding opportunities for the majority without a degree is critical given low unemployment and significant talent gaps in the labor market.

Real change and disruption can only happen when the entire work ecosystem—policymakers, educators, employers, and the workforce—shakes off these stigmas to embrace and celebrate workers who have equipped themselves with the skills necessary for employment in a way that worked for their learning style and budget at that stage in their lives. The true value of these workers lies in their skilled expertise and their potential to fill ongoing talent gaps that, if left unaddressed, could result in a $1.7438 trillion lost revenue for businesses by 2030 .

Promising progress

While the promise of competency-based education is not new, it has been slow to catch on. When analyzing the state of employment requirements, our report found that only 12% of companies have no degree requirements. Employers, educators, and workforce development practitioners have long advocated the value of career and technical training, including apprenticeships and industry-recognized credentials. However, the stigma surrounding these certificates and credentials as “less than” continues to exist.

The main reason companies still have degree requirements is that they believe candidates with a university degree are better prepared for the role, our report found. However, we appear to be reaching an inflection point as studies begin to show a diminishing return on investment for four-year degrees, which has led some higher education institutions to pioneer and expand competency-based programs. aligned to the industry.

Even more encouraging, new proposals in Congress, such as the bipartisan Stronger Workforce for America Act and the Bipartisan Pell Workforce Act, rethink how federal investments in postsecondary education can help more learners, especially working adults, have non-traditional, high-quality access. learning paths that lead to good jobs.

More than 20 states have eliminated licensing requirements for many state jobs, and nearly half of employers report working to do the same this year. Even the federal government is taking steps as our nation’s largest employer to adopt a skills-based hiring approach in every federal agency. Just last week, Vice President Kamala Harris said she would eliminate college education requirements for certain federal jobs if elected president, and while in office, former President Donald Trump issued an executive order prioritizing skills over of diplomas. All of this progress is promising, but as our Employment Report shows, there is much work to be done to implement these decisions and policies.

I have witnessed the success of credential-based programs firsthand in my role as CEO of an edtech company. I am inspired by students like a newly arrived immigrant who enrolled in an adult education program to learn English and gain the skills needed to acquire health credentials that improved his employability. Or a former teacher and single mom balancing online classes with family life to re-enter the workforce and transition to a new career as a children’s crisis counselor. Stories like these fuel America’s collective passion and commitment to continue tearing down the paper ceiling.

Obvious obstacles

Despite these success stories, obstacles remain in the most obvious places – education and employment. As the concept of expanding educational pathways and modernizing learning to develop career-ready graduates emerged, the education system itself was slow to adapt and connect learning with modern labor market realities. According to our report, 39% of recent graduates did not apply for entry-level jobs because they felt underqualified, up from 33% in 2023.

Employers are also struggling to move beyond traditional employment structures and invest in in-house skills training as they too want to see a clear return on investment. However, the growing skills crisis is beginning to open employers’ eyes to the value and impact of adopting a skills-oriented mindset. In fact, our report found that employers will prioritize a candidate who demonstrates a mastery of the skills required for the position (38%) over one who only has a college degree (19%).

When educators and employers cling to a bachelor’s degree as the primary determinant of career preparation, they fail to account for the diverse skills, interests, and capabilities that nontraditional learning can provide. Without embracing multiple educational pathways as viable ways to gain skills, we will continue to restrict economic mobility for millions of skilled workers due to the lack of a degree.

This perpetuates society’s wealth gap, blocking the path to the middle class. By addressing the systemic barriers of the paper ceiling and providing more equitable access to education and training, we can empower skilled workers to reach their full potential, ultimately creating a more prosperous economy for all.

To modernize their approach and continue to break the paper ceiling, educators and employers must:

• Empower student choice – early. Through avenues such as dual enrollment programs, career and technical high schools, youth apprenticeships, and more, educators can de-stigmatize degrees earlier and normalize different learning paths after high school.
• Leverage connections between educational institutions, such as community colleges, and regional employers so that institutions understand specific skills gaps and workforce needs in the real economy.
• Explore unique talent pipelines through partnerships with workforce development programs, externship opportunities and apprenticeships.
• Establish clear criteria for evaluating non-traditional candidates during the recruitment process. The Society for Human Resource Management (SHRM) reports that only one-third of applicant tracking systems (ATS) recognize non-degree credentials, and that recruiting technologies already filter out nearly half (45%) of candidates who hold these unrecognized credentials.
• Embrace a culture of continuous learning to maintain lifelong employability and improve career adaptability. The rising generation of workers will have more jobs throughout their lives, and education can empower and support individuals for the evolving job market.
• Practice cross-generational mentoring, which can help experienced workers learn new skills and understand new ways to solve problems.

The progress so far in breaking the paper ceiling is promising. Our report found that 67% of employers are expanding their hiring search to include candidates with industry certifications and credentials. But the work is far from over. The last obstacle lies in the most obvious places – the education system and the hiring practices of employers. The way forward requires a concerted effort across the labor ecosystem to evolve the outdated mindsets that have perpetuated this oversight for far too long.

Only then will we unlock the true potential of an underutilized workforce whose skills are vital to filling jobs and fulfilling America’s economic potential.

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