Why Are Companies Cutting Out College Degree Requirements?

Why Are Companies Cutting Out College Degree Requirements?

A growing trend reveals that more than 60% of employers have eliminated the requirement of a college degree. The next five years could see up to 1.4 million open jobs for Americans without degrees.

The Burning Glass Institute analyzed over 51 million job postings to better understand the structural and cyclical resets that have reduced degree requirements in almost one million jobs. Over the past two years, a “predictable shift in the mix of occupational hiring” has uncovered two types of change among middle-skill and high-skill roles, according to the 2022 report.

The list of major companies to drop these requirements include General Motors, Kellogg’s, Dell, Bank of America, Google, Okta, IBM, Walmart, and Delta Airlines. Walmart said its decision was in line with revising corporate job descriptions to reflect that “there are many roles where a degree is simply unnecessary, including at corporate headquarters.”

According to data, IT and managerial occupations have also adopted a structural reset as they feature “significant technical or analytical requirements.”

For example, the share of postings stipulating a bachelor’s degree for a telecommunications engineering specialist position declined from 66% to 58% between 2017 and 2019.

On the other hand, since the start of the pandemic, cyclical resets removing degree requirements occurred in 27% of occupations, including critical care nurses and registered nurses in the healthcare sector.

“Those occupations usually require specific credentials other than a traditional higher education degree, including health-specific certifications, state-licensing requirements, or certain measurable skills,” the analysis read.

For example, in 2020, the share of postings seeking registered nurses with a bachelor’s degree declined by 5 percentage points compared to 2019, from 38% to 33%.

What do employers want?

The Burning Glass Institute’s analysis of 33 million job postings between 2017 and 2019 shows that employers who’d cut credential requirements sought job candidates with a “wider and deeper set of skills than were required previously.” Today, employers require that candidates possess soft or social skills such as communication and conflict resolution.

Why is college enrollment decreasing?

The last few years have seen some of the smallest tuition increases in decades. Only about one in six students actually pay the sticker price at a four-year institution. In fact, a June poll by Gallup found that just 36% of Americans have confidence in higher education, down more than 20% from eight years ago.

How fast is school tuition rising?

Last year, the average tuition at American private colleges rose by 4%, according to data collected by U.S. News & World Report. For a public in-state school, that cost was $10,500, an annual increase of 0.8% for in-state students and about 1% for out-of-state students. Insider documented that the room and board costs of 10 public colleges have accelerated faster than tuition costs, at an increase of more than 20%, and that doesn’t account for inflation.

What is driving the increase in school tuition?

The price of faculty and administrators went up. A recent study by the American Council of Trustees and Alumni reveals that spending grew by 29% between 2010 and 2018, compared to a 17% increase in spending on instructional staff. State legislatures are contributing less to public education and lifted degree requirements for government jobs, according to to the Brookings Institution.

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