How College Broke the Labor Market

How College Broke the Labor Market
How College Broke the Labor Market

In the past few decades, going to college has become almost a given for many young people. It’s seen as the pathway to success, a ticket to a well-paying job, and a way to secure a stable future.

According to The National Bureau of  Economic Research, But what if I told you that this system contributes to the labour market’s brokenness?

The College Conundrum

What Is The Purpose of Doing a PhD?
PhD

The Rising Cost of Education
One of the major issues with the college system today is the soaring cost of education. As tuition fees skyrocket, students must pay massive debt to get a degree. This debt burden often follows them well into their working lives, shaping their career choices and financial decisions.

Mismatched Skills
Another problem is the mismatch between the skills colleges teach and the skills employers need. Many graduates are ill-prepared for the job market realities, lacking practical skills and real-world experience.

The Credential Obsession
Employers increasingly rely on college degrees as a screening tool, even for jobs that don’t necessarily require them. This creates a vicious cycle where more and more people feel pressured to get a degree to stay competitive in the job market, further driving up demand and costs.

 

The Rise of Credential Inflation

Study Finds Unemployment Up for University Graduates
Council of Ontario Universities

As more and more people obtain college degrees, the value of those degrees decreases. This phenomenon, known as credential inflation, means that many jobs that used to require only a high school diploma now demand a bachelor’s degree, and so on. This artificially inflates the education requirements for many positions, shutting out qualified candidates who don’t have the means or desire to pursue higher education.

 

The Impact on the Labor Market

Bachelor's Degree Salary By Programs
Degree Salary

Stifled Innovation
We risk stifling innovation and creativity by placing such a heavy emphasis on formal education. Some of the greatest minds and talents may never enter the workforce simply because they couldn’t afford or didn’t see the value in a college degree.

Wage Stagnation
The oversupply of college graduates has also contributed to wage stagnation in many industries. With so many people competing for the same jobs, employers have less incentive to offer higher wages or invest in employee training and development.

 

A Call for Change

College With Highest Graduation Rate 2024
Graduation Rate

The current college-centric approach to workforce development is not sustainable. We must rethink how we approach education and employment to fix the labour market.

Emphasizing Skills Over Credentials
Employers should focus more on job candidates’ skills and abilities rather than their formal credentials. This means investing in alternative forms of education and training, such as apprenticeships, vocational programs, and on-the-job learning.

Making Education More Accessible
We must also make education more accessible and affordable for everyone. This could involve expanding financial aid programs, reducing tuition fees, and promoting alternative pathways to success outside the traditional college route.

Promoting Lifelong Learning
Finally, we need to promote a culture of lifelong learning where individuals are encouraged to continuously develop their skills and adapt to the changing demands of the job market. This could involve offering subsidies for professional development courses, creating more opportunities for upskilling and reskilling and fostering a mindset of curiosity and exploration.

While college can still be a valuable experience for many individuals, it’s time to recognize its limitations and work towards a more inclusive and flexible approach to workforce development. By breaking free from the constraints of the current system, we can create a labour market that is fairer, more dynamic, and better equipped to meet future challenges.