AI is Making College Degrees Less Relevant, Study Finds
A recent report from PwC reveals a clear shift in employer preferences: formal college degrees are becoming less important, especially in industries affected by artificial intelligence (AI). The “2025 AI Jobs Barometer,” which examined nearly a billion job ads and company financial data across six continents, highlights how the skills employers seek are evolving faster in AI-related roles compared to others.
For example, skills needed for financial analysts—who face significant AI disruption—are updating 66% faster than those for physical therapists, a role less influenced by AI. This pace has risen sharply from 25% just last year. PwC points out that AI accelerates the obsolescence of existing skills and knowledge, making traditional academic credentials less relevant. Instead, employers prioritize candidates' current abilities and practical knowledge.
Changing the Hiring Equation
Joe Atkinson, PwC’s global chief AI officer, emphasizes that AI tools and large language models are reshaping education and career development. Practical AI skills and self-directed learning are becoming essential to stay competitive. While formal education still plays a role in developing critical thinking and interpersonal skills, these higher-order capabilities might grow more valuable as AI continues to evolve the job market.
Food for Thought
- The credential shift follows a long pattern of job market change.
The declining emphasis on degrees is the latest phase in how hiring practices evolve. Back in the 1970s, resumes included personal details now banned by EEOC rules. The internet introduced digital recruiting in the 1990s, and today, skills-based hiring dominates. Currently, 81% of companies use skills-first hiring methods, with 90% reporting better results when focusing on abilities over degrees. This change reflects a broader move from valuing educational pedigree to assessing real-world skills. - Technology tends to create more jobs than it eliminates.
Despite fears, history shows that technology usually increases employment opportunities. Since 1960, U.S. productivity and jobs have grown together 79% of the time. Past shifts, like the transition from horse-drawn carriages to automobiles, eliminated some roles but created many more. While some jobs vanish—like switchboard operators—new positions emerge, especially in healthcare and STEM. The key difference now is how fast skills change in AI-exposed jobs, demanding quicker adaptation. - Democratized knowledge brings opportunity and pressure.
AI tools open access to expert knowledge, benefiting those without formal degrees but also raising performance standards. Over half of workers surveyed by Pew Research say continuous skill development is vital. Between 1980 and 2015, jobs requiring higher education grew 68%, outpacing lower-education roles. Nearly half of workers have sought extra training in the past year, while companies increasingly drop degree requirements in favor of competency assessments.
For educators, these findings suggest a need to focus more on practical and adaptable skill development than solely on traditional credentials. Supporting learners in gaining up-to-date AI skills and fostering self-learning habits can prepare them better for a job market that prizes ability over formal degrees.
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