How the Paper Ceiling Hurts Millions of Workers

For decades, companies have required college degrees as a prerequisite for applicants, alienating more than 70 million people in the U.S., or half the workforce. This “paper ceiling” prevents those without a bachelor’s degree from applying to many jobs. They are often limited to low-to-middle-wage jobs, even if they have the skills for higher-wage positions. This emphasis on a degree is costing otherwise qualified workers hundreds of thousands of dollars. 

TAKE ACTION

• Learn more about the paper ceiling.

•  Join the Debt Collective’s student debt strike.

•  Consider what biases you have towards people without college degrees. How does prioritizing degrees over skills and experience shift the labor market? Who is affected by this shift? What value do we assign to higher education and degrees? Is it worth it?

• For employers and hiring managers: Assess your hiring practices and how you screen prospective candidates. Is a degree necessary for the position? How can you benefit from and incorporate more skills-based hiring?

• For workers without degrees: SkillUp Coalition offers tools and resources for skill development, training, apprenticeship, and job search assistance. 

Research from Georgetown University found that the average bachelor’s degree holder makes $2.8 million over a lifetime, compared to the $1.6 million made by the average high school graduate. Employers use degrees as a proxy for job competency and readiness, effectively screening out otherwise qualified candidates. Most large companies screen resumes through applicant tracking software, filtering out about half of all applications (Harvard Business School). Only a third reviewed whether this practice results in good or satisfactory employees (Havard Business Review). The paper ceiling disproportionately affects Black, Latine, and rural workers together with veterans, those less likely to have a degree. 

What was “once a bridge to opportunity” quickly evolved into a “drawbridge that gets pulled up” for those who don’t have a bachelor’s (Tear the Paper Ceiling).

After the Great Recession, more than 90% of the 11.6 million jobs created went to people with at least some college education (Education Week). From 2012 to 2019, 69% of new job postings were in fields requiring a bachelor’s degree or higher for entry (Tear the Paper Ceiling). A 2017 study found that more than 60% of employers rejected otherwise qualified candidates for not having a college degree and that millions of job postings list a degree requirement for positions that existing employees don’t have (Harvard Business School). “Employers are seeking a bachelor’s degree for jobs that formerly required less education, even when the actual skills required haven’t changed or when this makes the position harder to fill” (Burning Glass). This undermines the job market while simultaneously shrinking the job prospects for millions of workers.

Researchers found that despite having difficulty finding “suitable candidates,” most employers increased the degree requirements for those middle-skilled positions, constraining the “talent pool on which they were drawing, making it harder to fill vacant positions, fast” (Harvard Business School). Additionally, degree holders in these positions had higher “voluntary turnover” rates and lower levels of engagement for higher wages despite their performance not being on par with their experienced, non-degree-holding colleagues.

We need to transition to skills-based employment. Skills-based hiring leans on a candidate’s quantifiable skills and experience rather than their pedigree. In the past year, 20% of job postings on LinkedIn didn’t require a degree, and that number continues to grow. More states have dropped degree requirements for many state jobs. And a growing number of companies, primarily in tech, have eliminated such prerequisites. In the next five years, 1.4 million jobs could open up for workers without college degrees with this “emerging degree reset.” 

Such a shift has saved companies money by reducing the cost of a bad hire, which costs 5 to 27 times the person’s salary. More importantly, it opens doors for people historically barred from higher education and, as such, quality job opportunities and gives people an alternative to incurring thousands in student loan debt just for the promise of a job.