Universities are a big industry that has remained remarkably resistant to change. While getting a job isn’t the only reason people pursue a degree, it’s an essential one. If a university degree was no more valuable than a high school diploma, then enrollment would drop—or universities would change to ensure they had a bigger impact. Ideally, from the viewpoint of business, a university education should add to someone’s capability—the value shouldn’t be in the degree, in the piece of paper, it should be in the education. I’m not sure that always happens and society would be better off if universities raised their game.

People without university degrees do find themselves at a disadvantage in the job market no matter how competent they are. That’s a result of how recruiters work. Potentially recruiters could assess the capabilities of anyone who applied regardless of their education, but historically it’s been easier to narrow the applicant pool by requiring a degree.

We normally look to politicians or the universities themselves to drive change, but maybe that’s not the right lever; maybe it’s recruiters who will disrupt university education.

The Incredible Power Recruiters Have Over Universities
Let’s start with a simplified scenario. Imagine if recruiters found that an MBA graduate was no more likely to succeed as a manager than a smart high school dropout. Universities would have to ensure their MBA programs really did add to a student’s ability to be a manager, not simply rely on the reputation of the degree.

A more detailed scenario would be that recruiters might learn that they didn’t need the data point of what degree a person has to select the best performers. Imagine if the best predictor of managerial potential was a series of tests given by a recruiter. It is likely that MBA grads, on average, would score higher on those tests than dropouts; but knowing what degree a person has wouldn’t add to the accuracy of the prediction of performance. As a student you’d have to decide whether an MBA was the best way to get your scores up since the scores, not the degree, would guide the hiring decision.

Recruiters have great power over the education system because one of the main reasons students go to university is that it will impress recruiters. This power is not new; what is new is the ever-increasing ability to predict performance based on data.

It’s Got To Be About Data
Why do recruiters hire university grads rather than people with a high school diploma? In part it’s because that’s what always been done. They seek graduates from “good” universities because it seems to make sense.

However, we are moving away from a world where we do “what we’ve always done” and “what seems to make sense” to a world of “what the data shows.” We are getting better at analyzing what characteristics lead to good performance and so recruiters should end up relying less on the piece of paper or school reputation in deciding whom to hire.

The New World of Credential-less Hiring
At the moment we rely on whether or not a person has a university degree as an important piece of data in screening candidates. We can get more predictive measures. When that happens, it will lead to a revolution in universities. Students will flock to the programs that add to their real capability and steer clear of the ones that don’t.

Perhaps in the future the self-educated drop-out who has spent time participating in Toastmasters and studying Khan Academy videos will find themselves scoring higher on a recruiter’s assessment tests than someone who’s main claim to competence is the name on their degree. Recruiters will succeed in bringing the revolution to higher education where others have failed because they’ll have the data to know what education really makes a difference.

Once again, people may pursue university education for reasons other than its impact on their career. However, if a student is investing a lot of time and a lot of money in a degree then it should genuinely improve their capability. Universities programs that do that should be cheered and those that don’t should be changed. Recruiters can make that happen.

David Creelman is CEO of Creelman Research. He is best known for his workshops on Agile Analytics, Evidence-based Management and the Future of Work. You can connect to him on LinkedIn or email dcreelman@creelmanresearch.com.