I am sure you have heard one of your classmates assert, “A college diploma is the new high school diploma.”

One hundred years ago only ten percent of the population graduated from high school. If you had a high school diploma, you stood out. You might get a job at the local bank, work diligently for thirty years, and become bank president.

Today thirty percent of adults have a college degree. In one sense that degree serves the same purpose a high school diploma performed a century ago–signaling. If you manage to graduate from college, you must be reasonably intelligent, conscientious, and willing to conform to societal norms. In other words, there is a good chance you would make a satisfactory employee.

It is time-consuming and expensive to hire people. Firing them is even more so—as well as being unpleasant. You can’t blame prospective employers from glomming on to such a readily available filter as the college degree. However, we have reached the point where up-credentialing has become an epidemic. My “go to” example of up-credentialing is the sixty-seven percent of postings for executive assistant that have a requirement for a bachelor’s degree. However, I recently found a more egregious illustration—McDonald’s cashier.

Before you abandon reading my post and start desperately filling out college applications, let me get to the real reason a college degree is not equivalent to the high school diploma of yesteryear–RISK. Today there are three material risks that make earning a college degree much trickier than acquiring a high school diploma:

Financial

You have the opportunity to attend high school for free. College costs money—lots of money. You can end up buried in student loan debt. Funding your tertiary education can seriously undermine your parent’s retirement plans.

Opportunity Cost

Investopedia defines “opportunity cost” as, “…the benefit that a person could have received, but gave up, to take another course of action.” On average a four-year degree requires five years today. Believe it or not, there are other options that lead you to become a financially self-sufficient adult in less than five years.

Low Return on Investment

In the last decade—following The Great Recession of 2008–half of all college graduates have ended up under employed. (A full twenty-five percent of minimum wage jobs—like a McDonald’s cashier—are held by college grads.) This is because of the imbalance between Supply (grads) and Demand (suitable jobs).

It follows that the “signaling” value of a college degree has been seriously watered down in the last twenty years. I argue that it takes a “rich” resume, not just a college degree, to signal, that you are an outstanding candidate in today’s job market.

Notes:

https://www.esl101.com/blogs/whats-credentialing-why-topic-matters#.WnMQ7UxFw2w