Will university degrees become less relevant in the future?
In the best-selling book Think and Grow Rich, author Napoleon Hill says, “Knowledge isn’t power, it’s only potential power.”
How true is this statement if you cannot apply the knowledge gained in your work or job.
Knowledge is power if and only if it serves people, it creates value for people, or it is useful to other people.
What’s the use of storing information in your head unless it’s serving people or it’s put to good use in a job?
Ultimately, it’s all about innovation and value creation, not education.
That’s what money really represents.
It’s a value exchange.
If you are a worker, a contractor, a freelancer, or even an employee, this value exchange is with your employer.
In return for the work you do, you get paid.
Your future payments will be totally dependent on your employer remaining in business.
Here’s what we must realise.
Businesses that do not adapt to changes in their industry and marketplace will be quickly sidelined as nimble operators grab market share. It’s about embracing change or die.
As an example, the demise of Toys “R” Us’ at the hands of e-commerce and automation is becoming the norm for many businesses.
What’s more alarming is that retailers in the U.S., the U.K. and elsewhere have been filing bankruptcies in increasing numbers.
Why it matters to us?
Retail is the largest single source of American jobs and elsewhere. It’s one of the biggest parts of the overall economy.
Research commissioned by the Chartered Accountants Australia and New Zealand confirms that rapidly evolving commercial environment calls for businesses to be increasingly agile. It was found that 55% of businesses that reported being above-average in terms of agility were also experiencing above-average revenue growth.
Increasingly as organisations evolve and grow, they will require relevant skilled people who can effectively support the business when workloads are higher or when specific skills are required to navigate times of change and increasing customer demand.
University graduates need not apply
It’s no surprise that companies like Penguin Random House, Ernst & Young, and PricewaterhouseCoopers have stated openly that they no longer require university degrees in their search for good candidates.
Instead, these companies want to recruit newcomers who have a broad range of life and education skills and experiences.
As such, university degrees will become less relevant in the future especially when universities do not equip their students with relevant employable knowledge and skills that will meet future employers’ requirements for particular job skills, experience, and knowledge.
Employers are very specific of the work-ready skills you’re supposed to bring in.
That makes it challenging for students who haven’t designed their path through college to include picking up those kinds of skills.
Therefore, to be relevant, universities must get their undergraduate and post-graduate students job-ready and future-ready with the necessary soft and hard skills and practical experience.
Their undergraduate students must be job-ready and future-ready so that they can easily find jobs that match their strengths when they graduate years later.
For their post-graduate students who enrol in universities for knowledge and job upgrades and perhaps even for job promotions, the knowledge gained from universities will evermore be more targeted and specific to the needs of their future employers. These students want to obtain a competitive edge over other people through university education.
Employability should be the key factor for universities to be relevant to the future of work, especially from a funding perspective.
Without revenues from fee-paying students and research funding from governments, universities will not be able to exist for long.
While there may be people who attend universities purely for an educational and social purpose, this is really the minority group of people.
Students are getting further into debt with study loans
In the U.S., LendingTree reported that the total student loan debt has surpassed $1.5 trillion and it comprises 42% of all consumer debt. That far exceeds the 27% share of debt credit card balances occupy. A decade ago, those percentages were reversed.
In trying to acquire employable and job-upgrade knowledge, and skills and experience to be job-ready and future-ready, many students will be accumulating student loan debts if they cannot afford to pay cash for their courses.
Repayment of these student loan debts will largely depend on whether these students can find suitable paying jobs after their graduation and potentially a higher paying job in the future.
These debts do linger on for many years, even into retirement.
For many, paying off student loan debts may not come easy as many workers are also known to live paycheck-to-paycheck. Some do not even have much savings at all.
Many students will then hope and pray that they will secure full-time jobs relevant to their field of study upon their graduation.
Some will hope and pray that they will get that promotion or higher-paying job with their expensive post-graduate degree.
Unfortunately, this passive strategy will not work for many people.
Many students may end up in this position – no job, but big study debts to pay.
There are so many challenges ahead
Research by the National Institute of Labour Studies found that between 2008 and 2014, the proportion of new university graduates in full-time employment has dropped from 56.4% to 41.7%.
Research by The Foundation for Young Australians revealed that 25-year olds are better educated and more invested in their education than ever before, but half of them can’t get a full-time job. Nearly 60% has tertiary qualifications, up from about 30% in the late 1980s.
The Australian Graduate Outlook Survey found that around one in five (20.5%) graduates had taken more than 12 months to find their role.
In Singapore, four in ten graduates can’t find full-time work.
The Wall Street Journal reported the troubling results of the College Learning Assessment Plus test administered in over 200 colleges across the U.S. More than half of schools and at least a third of seniors were unable to make a cohesive argument, assess the quality of evidence in a document or interpret data in a table.
At some of the most prestigious flagship universities, test results indicated that the average graduate showed little or no improvement in critical thinking over four years.