Everyone knows college has degraded into an expensive four-year party and prolonged adolescence for young adults. Sleep in, show up to classes, regurgitate what the professor says onto some papers, and a hundred-thousand dollars (or more) later, all students meeting the barest minimum requirements will walk on stage to collect their diplomas.
This bemoaned but persisting state of affairs has led some to declare that the college degree is “worthless,” or that it “tells us nothing” about its bearer. Such critics have a point: degrees no longer guarantee deeper understanding in a field of study (if they ever did). Yet employers across the board continue to weight higher education in important hiring decisions. This paradox implies another variable in play – some hidden value of the degree that the credential deniers are missing.
The best and simplest explanation, from the economic perspective, is employers are using degrees as a proxy for information they are unable to obtain through other means. This information could include an applicant’s economic status, home environment, capacity for long-term commitments, and freedom from any crippling physical or mental disorders lurking under the surface.
First and foremost, a diploma means the graduate had access to the substantial amount of money necessary to obtain it, which is an excellent indication of a stable family life and financial background. Some of the most pervasive problems employers face are employee absenteeism, tardiness, and turnover, all of which are closely associated with the trappings of poverty or lack of family support (e.g., single parenthood, second jobs, lack of adequate transportation, changes in living situations, etc.). The colossal price of admission to college is itself the best indication that these complications are less likely to flare up in the workplace and cause problems.
A four-year degree also means the completion of at least one long-term and voluntary full-time undertaking. The commitment might not have involved much day-to-day heavy lifting, but the sheer length of time involved, combined with the requirement that the student stay put for the duration of a program, says a lot about what the applicant did not do instead. He didn’t decide it was too hard and drop out; he didn’t run off and join the peace corps; he didn’t fall into a deep, dark, debilitating pit of alcoholism or depression; and so on. The fact that none of this occurred on the college’s watch, when it was statistically most likely to happen, is the best possible predictor that it will not happen in the next four years of employment.
Viewing a diploma not as a reliable certification of subject-matter expertise (which we all know it isn’t), and instead as the most reliable predictor of stability available to employers, the nearly universal preference for graduates over non-graduates reveals itself as entirely rational and self-interested behavior.