Parents Are Now Rethinking the Value of College & the Labor Market Freezes

Additional Resources

• BLS JOLTS Release
• ASA Youth Career Readiness Outlook
• WGU Workforce Decoded Report

Transcript

Pete Newsome: 0:00

Today’s job market headlines tell us how parents are rethinking the college to career path for their kids, and new data shows what employers say really matters in today’s job market. But first, the hottest news in today’s job market is that it’s not hot at all. The October Joltz report came out this morning and it shows a labor market that isn’t surging or collapsing. It’s really just holding still. Let’s look at the numbers. Job opening stayed at 7.7 million, which is unchanged from September. Hires were also stable, employers brought on 5.1 million workers, which is the same as the prior month, and no industries showed meaningful hiring shifts. Total separations also held at 5.1 million. Now quits, which is a metric everyone watches as a signal of worker confidence, held steady at $2.9 million, but over the past year, quits are down $276,000. This October report tells a clear story.

0:57

The labor market has cooled from its peak, but is now moving sideways rather than sliding down. It’s just stability all around in openings, hires, and separations, but the big watch item for me is a decline in quits. Workers aren’t job hopping like they were just a couple of years ago, and that means fewer competing offers and opportunities out there, more cautious decision making, and an overall shift in leverage back toward employers. And unfortunately, I don’t expect that will change in the foreseeable future. In the next headline, parents are rethinking what the right path after high school looks like for their kids. American Student Assistants just published survey results showing families are increasingly open to non-degree pathways. Parents still prefer college overall, but not nearly as strongly as they used to. In 2019, 74% said it was their top choice. But in 2025, that number has fallen to 58%. One of the biggest changes is perception of career and technical education, or CTE.

2:01

In 2019, just 13% of parents thought CTE was a suitable path for high-achieving students. But in 2025, that number has jumped to 35%. Now, 89% see drawbacks to non-degree paths, especially limited career growth and opportunities and lower income potential. That makes sense. College is still generally considered the safer route, but I, for one, like seeing this evolution of the four-year degree. It should no longer be the default answer for all students. What we need is for the primary and secondary education system to catch up and focus on student aptitude and interest when providing guidance as the labor market continues to evolve. Because the degree still matters, but it’s no longer all that matters. In fact, that is changing rapidly. And I love the way this report captures it, it just does it beautifully. And our final headline is further evidence of that changing or perhaps conflicting perspective. Most employers say degrees are important, but only about a third believe colleges are preparing students with the skills needed for today’s workforce.

3:08

How’s that for a contradiction? A new survey from Western Governors University reveals a hiring landscape undergoing a major realignment. Degrees, skills, certificates, demonstrated experience, and proof of ability are now working together as kind of a readiness portfolio. The data shows employers still value degrees. Experience continues to matter greatly. 78% of employers say work experience is equal to or more valuable than a degree. And 46% plan to increase their focus on skills-based hiring in the next year. It’s safe to say that that has now become an undeniable trend. Here’s what they say are the most important skills for the next 12 months: critical thinking and problem solving, time management, and adaptability and resilience. Those are also exactly the kinds of human capabilities AI can’t easily replicate. However, AI skills are fast becoming a baseline requirement.

4:17

Nearly 50% of employers are assessing AI readiness in candidates through AI tools experience, AI certifications, or technical interviews. And some, as you can see on the chart, are still figuring it out. Overall, this report reflects what I’m seeing in the market. Employers are no longer using degrees as a gatekeeper for hiring. Instead, they’re building a multidimensional picture. The degree plus skills plus experience plus proof of what the candidate can actually do. And they will weigh those differently depending on the opportunity and the specific hiring need. But the data point that jumps out the most for me is around certificates. 86% employer confidence in certificates. That is not a small trend, that’s a structural shift. Certificates used to be a nice to have.

5:03

Now it’s clear that they’re validating skills in a way employers actually trust. So if you’re a candidate, take advantage of that. So those are our headlines for today. But before we go, here’s a fun fact. Hugh Jackman once worked as a party clown for kids. He went by the name Coco the Clown. And from what I read, he didn’t know any magic. He was just a clown. Although I can’t imagine him being bad at anything, but those he said he wasn’t very good. I’m sure he was. So thank you for listening today. Please like, subscribe, share with anyone you think might be interested, and I’ll look forward to talking to you tomorrow.