IIn a recent article, Rick Hess argues that there is a strong link between the growing burden of student debt (which led to President Joe Biden’s recent loan cancellation) and “degree inflation”, according to which employers require higher levels of education for jobs that have not changed. a lot over the years in terms of responsibilities or compensation. He is absolutely right.

Research has shown massive increases in the proportion of job postings that require a degree for positions such as office administrators and supervisory roles in retail, sales and trades. In the past, these were viable rungs on the middle-class ladder for those without a college degree, but today this is less often the case.

Drivers of these inflated requirements include employers’ hiring practices, actions of state licensing bodies, and even university accreditors. Motivations for screening anyone without a college degree also vary. It may just be easier to sort through fewer applications and degree requirements. It may also be one of the few easy and (for now) legally permitted filters that employers can use. Or it may have to do with elitism or protectionism: the desire to build walls to keep those with less prestigious, or simply more competitive, credentials out of a given profession.

Whatever the cause, however, the result is the same: it costs more to obtain the credentials needed to do the same job at the same pay as in the past. The connection between these requirements and the cost necessary (both for students and taxpayers) to obtain the required degrees should be obvious, but it is too rarely discussed. As Rick points out:

Washington has skewed the labor market by encouraging employers to turn college degrees into a general-purpose indicator of employability. This fueled degree inflation, exaggerated the importance of a college degree, and inflated costs.

Rick also rightly notes that the federal government could do more to “ensure that legally suspect degree requirements are subject to the same scrutiny as any other potentially suspect employment test.”

But the federal government also has a role to play as an employer; in fact, it is the largest in the country. During the previous administration, Executive Order 13932 removed degree requirements and preferences for federal civilian jobs and created broad space for what federal jobs might require instead.

Fortunately, this may be the only executive order from his predecessor dealing with the public service that President Biden has left in place. Its Office of Personnel Management has its work cut out to ensure that not only will federal agencies implement the order with fidelity, but also that they have the tools they need to expand their network and find talent. best manners.

As is the case in the private sector – where some large companies have also pledged to remove degree requirements – implementation is what matters most. Hiring based on what people know and can do, rather than just how many years they’ve been in school, is a smarter strategy that can help companies limit turnover, improve diversity and reduce hiring times.

The federal government could help itself and the private sector by aggressively implementing this order and developing concrete strategies that the private sector could then feel comfortable enough to adopt. In the long term, this could do more to promote opportunity and limit student debt than any debt cancellation program.


This article originally appeared in the AEIideas blog and is reproduced with the kind permission of the American Enterprise Institute.


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