Why do secretaries need college degrees now?
When's the last time you saw a job listing that didn't require at least a bachelor's degree? For more and more Americans, the answer is "a long time ago," and quite possibly "never."
A report late last year found that, in one traditionally middle-class sector after another, one-half to two-thirds of job openings now demand a college degree. Yet those same jobs — like "production supervisors" and "executive secretaries" — didn't call for a degree in the recent past, and many of the people who hold those jobs now are not college-educated. Despite the fact that only one-third of Americans have them, college degrees have become the new high school diplomas, the baseline everyone in the workforce is assumed to meet.
This has caused an enormous amount of angst and endless theorizing: Maybe it's a cultural change among employers. Maybe it's the atomization of America. Maybe it's just ruling class snobbery.
But there's a simpler explanation: Over the last few decades, we've seen an enormous shift in power from workers to employers.
As is often the case, the underlying story here is the disappearance of full employment. When jobs are plentiful, anyone who wants work can find it, and they can easily jump to another job if the current one doesn't suit them. Workers bargain their wages up, and inequality goes down.
From 1950 to 1970, we went through periods of full employment on a regular basis. Since then, we briefly hit it once in the late 1990s, and that was it. And we've been nowhere near full employment since the Great Recession.
The next thing to realize is how employers react when the supply of jobs pulls even with the supply of workers. You've probably heard a lot of talk about how employers are having a hard time finding skilled workers. But complaints about labor quality actually peaked during that brief, late-'90s encounter with full employment.
Remember that the relationship between employers and workers is a bargaining relationship: Each is trying to get as much as possible from the other for minimal cost. How that bargaining shakes out depends on the relative power of each side. Also, remember that full employment is an extremely unpleasant experience for employers: They have trouble finding people to fill openings, and they have to pay out the nose for them when they do.
Full employment, in other words, forces employers to make do with what they got. Conversely, when full employment disappears, employers are free to be picky and unreasonable in their demands.
For instance, one telling aspect of the modern economy is the disappearance of on-the-job training: In 1979, young workers averaged 2.5 weeks of training annually. By 2011, only one-fifth of workers said they'd received training in the last five years. So over the last three decades, employers have been investing less and less time and resources in bringing new hires up to speed. And why not? Over that same time period, there's almost always been a large pool of people, in every sector, who were desperate for work and likely already had the needed experience.
The rise of the college degree as the all-purpose job requirement is part of this trend.
Yes, it's also about "signaling" — the idea that a degree shows potential employers you were able to keep your grades up and finish your classes, that you've been properly socialized to take orders and finish tasks, and that you're familiar with the cultural rhythms and professional mannerisms of the upper-class from which employers themselves are drawn. But it's important to remember why employers can get away with this: They have power, and workers don't. And as their power grows, they can engage in ever-more frivolous and gratuitous demands for job applicants.
Incidentally, this is also why more and more of the college-educated themselves are being left out by the filtering mechanism. The absence of full employment and worker bargaining power also means wage stagnation. Inequality goes up when jobs are scarce, as more and more of the economy's income goes to fewer people at the top. When that happens, the number of people with college degrees outpaces the number of high-income "slots" in the economy.
As a result, more and more college-educated workers have been showing up in low-paid jobs since 2000, and the trend line is even more dramatic for the youngest college educated workers. Then there's the 20 percent or so of Americans who start college but never finish, either because they weren't academically prepared, or they're facing job, family, or economic hurdles. The get a double whammy: No boost to their lifetime earnings, and mountains of debt.
Furthermore, while that lifetime earnings boost for people with a college degree does exist, it doesn't behave the way you'd expect if those people were actually being paid more because their skills were in short supply. Rather, it behaves the way you'd expect if "people with college degrees" was an arbitrary category, imposed on a set of economic trends that are actually driven by different forces entirely.
Which is exactly what it is.