Degree inflation in the job market is not only closing off opportunities for workers but also costing employers money, according to a new Harvard Business School study using Burning Glass Technologies data.

In the job market, degree inflation means requiring a college degree for positions that never used to require one before. That’s a particular problem for “middle-skill” jobs, defined as those that require more than a high school diploma but less than a bachelor’s degree.

More than six million middle-skill jobs are at risk of degree inflation, according to the report, “Dismissed by Degrees,” produced by Harvard Business School, Accenture, and Grads of Life. In addition, 3 in 5 employers surveyed reported that they had difficulty filling middle-skill jobs.

The trend poses a threat to middle-skill workers, because they are being essentially locked out of jobs that support a middle-class lifestyle—even if they have experience. Three in 5 employers said they reject qualified middle-skill candidates with relevant experience in favor of college graduates, according to the report.

The report found employers started raising requirements in search of higher skills, but that, but that the practice has consequences for employers as well as workers. According to the press release:

  • Two-thirds of employers agree that requiring a bachelor’s degree for a middle-skills job makes the job more difficult to fill.
  • Three in five employers reject qualified middle-skill candidates with relevant experience in favor of recent college graduates.
  • Half of employers report paying higher compensation to recent college graduates than non-degree workers in the same job. Of those employers, 68 percent pay recent college graduates salaries 11 to 30 percent higher than middle-skills workers with experience. Yet, degreed workers are more likely to leave for a competitor.
  • Employers generally perceive degreed and non-degreed workers in the same occupation as nearly or equally productive on many performance metrics.

The report builds on research Burning Glass Technologies conducted in 2014, which found significant “credential gaps” between what employers ask for in job postings and the credentials current workers have. That trend continues, according to the Harvard report. More than two-thirds of production supervisor job postings ask for a bachelor’s degree, but only 16 percent of current supervisors hold one.

The full report is available at the website of Harvard Business School’s Project on Managing the Future of Work.
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