The Headlines
Skills, not suits
Employers are more likely than ever to hire based on skills – so what is the benefit of higher education?
By Chloë Lane
“It would be a bad thing for society if dropping these education requirements returned us to a time when far fewer people were able to justify going to college.”
“I resent the thought that corporations determine what counts as a skill, what constitutes virtue."
Job postings are less likely to have formal educational requirements than a few years ago, according to a new Indeed study. Employers are more likely than ever to hire based on skills and work experience instead of higher education qualifications – largely due to labour shortages.
Formal education requirements have fallen in almost every sector, the study found. Just one in five US job postings required an undergraduate degree or higher, and more than half didn’t require any educational requirements at all.
Justifying the value of higher education
With the high cost of higher education, the earnings loss while studying and rising costs , many believe that business schools must demonstrate their value to potential students.
Dr Kenneth Silver, Assistant Professor at Trinity Business School in Ireland, thinks we should be asking companies how they are meeting the expectations of workers, not how universities should demonstrate their worth.
“The ever-rising cost of education is an extremely worrying trend,” he says. “Part of why it is so bad, apart from the immediate material effects on student and alumni wealth and well-being, is that it pressures potential students into framing the decision to go to college in terms of a cost/benefit analysis. This is deeply unfortunate, because it’s a mistaken way to think about this decision.”
Higher education prepares students for the job market in many ways but Dr Silver doesn’t see this as their goal. “The mission of higher education transcends this – it is about how a student’s interests can be nurtured, challenged, advanced. We develop thoughtful citizens, not workers,” he says.
“It would be a bad thing for society if dropping these education requirements returned us to a time when far fewer people were able to justify going to college.”
Dr Silver encourages us to think harder about what is motivating the idea behind higher education requirements. When firms drop degree requirements to encourage more diverse talent, he explains, they are using the language of social justice to increase the competitiveness for their positions.
By removing requirements for higher education, candidates may feel ‘lucky’ to receive a job offer and may be less well-positioned to negotiate on their wages and benefits. “Enticing people to make a financial decision not to go to college is not a move in the service of equity. It promotes sacrificing something you deserve and coerces you into convincing yourself that academics aren’t really doing anything of value,” he remarks.
Building ‘meta’ skills
Trinity Business School’s undergraduate programmes are crafted with an emphasis on skill development. Starting with fundamentals of business topics, like management and finance, they then focus on more advanced topics and skills. Some of these skills are likely to be used directly by employers.
In his classes, Silver strives to build the skill of critical thinking, a skill which is generally highly sought after by employers, yet this is not his reason for teaching it. “I resent the thought that corporations determine what counts as a skill, what constitutes virtue,” he comments.
Whatever level you enter higher education, you are likely to graduate with heightened personal skills and an increased level of competence, explains Dr Barbara Stöttinger, Dean of Austria’s WU Executive Academy.
“Through the exchange with proven experts from the field and their experienced colleagues, students acquire ‘meta-skills’, which are indispensable,” says Dr Stöttinger. “They learn to embrace the emotional aspects of leadership.”
Meta skills are timeless, higher order skills that boost a person’s ability to learn and apply new knowledge quickly. At the WU Executive Academy, for example, students are taught to realign their focus on solutions and opportunities rather than on problems, adapting their strategy to a changing environment.
A safety net for high-risk experiments
One of the most valuable aspects of higher education is that students can leave their comfort zones and try out new and radical approaches. It’s a safety net, away from the workplace.
As an undergraduate, this experimental element of higher education is felt even more keenly. Studying an undergraduate degree is an opportunity for students, who often have little to no work experience, to ask questions, gain knowledge and skills, and take risks, without the pressures of real business implications.
It’s also important for building confidence, says Milly Collyer, a recent graduate from Sheffield Business School at Sheffield Hallam University in the UK. “Going directly into work without studying at university requires you to go into the job with little knowledge meaning that you are required to have the confidence to ask questions and speak up to people with far more experience than you.”
At school, her teachers encouraged her to apply for apprenticeships. Collyer describes herself as very career-orientated, so going directly into the workplace seemed like a natural next step for her. However, she decided to instead attend university, studying marketing with psychology.
“The chance to apply my degree-level learning to real business examples, with the support of experienced academic teams is something that apprenticeships and work don’t offer,” she explains. “Throughout my degree I have gained significant industry insight from applied modules and live-client briefs.”
Many students, like Collyer, start undergraduate degrees towards the start of their careers, when they may be uncertain about the path they want to take. Universities not only help these students acquire transferrable skills which can be used in a variety of careers, but also provides them with invaluable careers advice to help them secure a job they love.
“Studying a variety of modules, attending events, and meeting lots of different people gives students the chance to build their network and discover their specific interests before committing to a job route,” explains Collyer.
Even at MBA level, this risk-taking element is a draw. Marianne Baillot is an international MBA alumna and the Managing Director & Expansion Millésime of luxury French accommodation provider Millésime. She decided to study an MBA to make a shift away from an artistic career, with the aim of learning analytical, financial and managerial skills.
“My International MBA at Porto Business School led me to deeply question my habits, limits, and the way I perceive a problem. It is so refreshing to have different points of view,” she explains. “The variety of backgrounds and the presential mode of working makes a difference from real work experience in a company.”
‘Not essential for success’
Many MBAs provide support for aspiring entrepreneurs through entrepreneurship-focused modules and start-up incubators. But can entrepreneurship actually be taught at business school?
“I believe there are both advantages and disadvantages when pursuing entrepreneurship with a formal education background,” says Silje Lindtvedt Fladmoe, Norwegian School of Economics (NHH) alumnus and the CEO of Testhub Technologies.
She asserts business schools provide opportunities to develop crucial skills and build confidence, though it can be challenging to teach creativity.
“Startups require versatility across functions like marketing, sales, accounting, and HR. These are all areas we tapped into during my business studies.”
Testhub Technologies develops products based on research into human decision-making. Though she had not studied psychology, Silje says her time at NHH taught her how to understand research methodology, making it easier to understand new fields of research.
If she were to repeat her Business Master’s degree, Silje says she would tailor it more closely around her ambition to become an entrepreneur, focusing less on discussing large established corporations and spending more time connecting with businesses and expanding her network outside the university.
She believes the most important qualities for entrepreneurial success are self-motivation and courage. “My education gave me the confidence and courage to enter entrepreneurship, but the path varies for everyone.”
Examining the physical ROI of higher education
Given the high initial cost of higher education, students often seek return on investment. This ROI is likely to take both a physical form, in an increased salary, and a potential form, such as increased opportunities in the future, or a more extensive, connected professional network.
When reviewing salaries, then, the value of higher education is clear. According to the US Bureau of Labor Statistics, the medium annual income for an individual with a Bachelor’s Degree is $64,896 per year – an increase of 40 percent compared to individuals without a degree. For those with a Master’s, this jump is even higher, with average earnings of $77,844. An MBA is higher still, at $115,000 per year.
“What else should future managers use their money for than for investing in their own skills, knowledge and personal development?” remarks Dr Stöttinger. “Even during the financial crisis, it became apparent that many people used the uncertain economic times to invest in their own skills, knowledge, and careers, in order to emerge from the crisis stronger professionally.”
Some universities and business schools are helping to combat the high initial cost through financial initiatives. At the UK’s University of Sussex Business School, for example, several strategies have been implemented to address the high cost of education and showcase the ROI for students.
Some of these are related to financial aid, such asa hardship fund, scholarships, free breakfasts and two-pound meal days, to help students alleviate the economic burden of tuition and other expenses.
Others are more long-term benefits. Sussex collaborates with employers to facilitate recruitment events, networking opportunities, and on-campus interviews, ensuring students can access various job prospects.
“Empirical evidence suggests significant returns to higher education in the long run. The direct and indirect costs, while initially high, are lower than the expected gains over one's lifetime,” explain Professors Gabriella Cagliesi and Farai Jena, and Emily Huns, Head of Careers, Employability & Entrepreneurship.
It’s important to consider the long-term implications higher education, they explain, including the potential for career advancement, increased earning potential, and personal fulfilment.
Despite this, higher education isn’t something to be entered into lightly. “Prospective students need to carefully consider their decision to undertake HE and it’s important to seek as much guidance from different sources as possible,” they advise.
“If someone is undecided, they can always take time to work or pursue other interests and then re-evaluate the decision of whether to pursue a HE degree.”