College or bust. Literally.
That’s the upshot of new research by employment firm Burning Glass, which found that many employers now require a bachelor’s degree for positions that they used to fill with high school grads—even when the work itself hasn’t changed. Some employers are even willing to spend two or three times as long to fill an opening just to get the coveted college grad.
It’s no secret that a college education is becoming essential to a fulfilling career and middle-class earning potential. The unemployment rate for people with a bachelor’s degree or higher is a scant 3.2%; for those with only a high school diploma, it’s 6.2%. There’s ample evidence that college grads earn far more than less-educated workers, with a recent New York Federal Reserve study pegging the value of a college degree at nearly $300,000 — close to an all-time high.
The Burning Glass research shows that some decent jobs once open to high-school diploma holders—such as executive assistant, insurance clerk, production supervisor and tech-support specialists—no longer are. There are two likely reasons. First, employers may believe those jobs require more sophisticated skills than they did in the past. Second, companies may simply prefer to hire the most qualified people available, even if those people are over-skilled for the job.
The percentage of high-school grads enrolling in college has generally been going up during the last 20 years, and is now around 66%. The problem, however, is that college is expensive. Even if college pays for itself down the road, the upfront cost still discourages more people from enrolling, and many who do enroll drop out before four years and never earn a degree.
College costs have been rising about three times as fast as overall inflation during the last 10 years, and far faster than wages. With a weak economy cutting into tax revenues, many states have hiked tuition at public universities, making the most affordable tier of higher ed considerably less affordable. One result of that has been an explosion of student debt, which has risen nearly fourfold during the last decade to slightly more than $1 trillion. The typical borrower graduates with more than $30,000 in debt, which explains why so many grads move back in with their parents these days.
There are still a few ways to nab a decent job while foregoing the pricey education. As Burning Glass points out, employers don’t necessarily insist on a college education for jobs that require some kind of technical certification—such as many in healthcare. That’s because the certification itself proves the worker is qualified. Some trade schools have informal or even formal job placement agreements with employers for workers who complete training programs. Apprenticeships can still open doors for tradespeople in high demand, such as welders and plumbers.
Still, the value of a high-school diploma is plummeting, with no turnaround likely. If there were a sudden labor shortage, employers might loosen their credentials. But it’s likely to be a buyer’s market for labor for the foreseeable future. Business will be brisk at your local admission office.
Rick Newman’s latest book is Rebounders: How Winners Pivot From Setback To Success. Follow him on Twitter: @rickjnewman.