Andrew McAfee points to this passage from economist Thomas Sowell’s Race and Economics in 1975:
The widespread use of high school diplomas and college degrees as employment screening devices by employers has led to a belief that increasing education will increase opportunities, and/or that the reason for escalating educational “requirements” is a corresponding increase in the knowledge necessary to perform a given job. The well-organized education lobbies exploit these beliefs to the fullest. In fact, however, educational ”requirements” are often used by employers who are wholly unconcerned about the specific content of the education, but who regards a diploma or degree as an indication of the job applicant’s willingness to persevere and his grades as a rough index of his mental capability. The educational requirements are a hurdle which eliminates enough job applicants to narrow the employer’s choice down to manageable proportions. By making it possible for more young people to go over a given hurdle, society also makes it necessary for employers to raise the hurdle in order to weed out the same proportion of applicants. The result has been an upward spiral of credentials and requirements with more and more young people being forced to endure more and more years of education that they do not want in order to qualify for jobs where the education is not needed. As more and more jobs have been put beyond the reach of those without the necessary credentials, whether or not such individuals can do the work itself, those ethnic minorities who are not traditionally oriented toward formal education are particularly hard hit.
McAfee adds: “Higher education has become much more expensive, student loans now account for more debt in America than do credit cards, and a lot of diploma mills (by which I do not just mean for-profit universities) have sprung up.”
Andrew McAfee: Education and Employment: Some Thoughts Against the Conventional Wisdom
I would add to the list of woes the sorry amount of actual learning that seems to go on in universities.
McAfee also discusses briefly potential solutions.