Amid the so-called “Great Resignation” during the COVID-19 pandemic, businesses struggled to find employees. Unfortunately, it seems like they're still struggling on that front.
As we reported last week, many experts directly attribute worker shortages to the effects of the pandemic. But in a new report, the Cengage Group identified another reason – a requirement by most employers that applicants have a four-year college degree.
According to the report, 65% of employers are struggling to find talent, but 62% require a degree for entry-level jobs. In a survey of 1,000 hiring managers, the Cengage Group found that 43% of employers admitted that skills training credentials are more important than a degree when considering a candidate for a position.
"Employers seem to be stuck in a contradictory cycle, where they recognize that a degree is not an indicator of job readiness, but nonetheless require them as part of their candidate screening process,” said Michael Hansen, CEO of Cengage Group. “This outdated mindset and degree stigma is not only widening the labor gap, it's costing businesses time and money and turning away potential talent."
Are college degrees important?
When we consulted business experts, we found mixed views on the subject. Charles Catania, principal of Branding with Chuck, says colleges today are more geared toward specific job preparation, so employers consider it more important than they once did.
“The purpose of a liberal arts education wasn't to teach business majors, for example, about contracts, as it is now,” Catania told ConsumerAffairs. “Instead, the goal was to teach students how to think and give them the tools they need to solve the complex problems they faced in the real world. Students that come out of a college setting show employers that they have the stick-to-itiveness to see college through to a diploma at the end of four years."
Scott Lieberman, owner and manager of Touchdown Money, doesn’t buy that argument. He says a college degree is “absolutely not necessary” for most entry-level corporate jobs and that hiring should be about skills, character, and enthusiasm.
“Most employers are out of touch and lazy,” Lieberman told us. “It’s a simplistic way to toss away a large percentage of applicants without actually examining their credentials and getting to know them.”
Rising student loan debt
For the last two decades, young people who wanted to enter the middle class and get good jobs have sought a degree, often at a cost of tens of thousands of dollars. According to the Federal Reserve, the average student loan debt is more than $32,000.
“Frankly, it’s a scam that a 17-year-old, a senior in high school, must decide to pay an insane amount of money just to qualify for a job that will pay much less than that in the first year or even four years in the role,” Lieberman said.
The Cengage Group report concludes that corporate hiring policies are substantially shrinking the potential talent pool. The researchers note that only 38% of U.S. adults have a four-year degree.