Bystander,
You nailed it.
The backdrop of all of this is a very long term societal change, some good, some not.
Let's go back in the Wayback Machine to the 1880s. The U.S./the world was mostly an agrarian population but the industrial revolution was beginning to have its huge effect. A number of farmers' kids began moving to the big cities where there were manufacturing jobs, as compared to farming a bit more predictable with regard to planning a future. The "man" paid you as long as you did your work. After 40 years you get a gold watch and can retire somewhat comfortably.
But the technologies that flowed out of the industrial revolution (transportation went from foot to horse to carriage to locomotive to automobile to airplane; communication went from town crier to newspaper to telegraph to telephone to radio to television; medical care went from folklore to vaccination prevention to antibiotics to organ transplants and orthotics) required more out of the ordinary person --- a qualification more than a strong back and eagerness, to do some of the work needed. A qualification immediately recognized without much background check --- the college degree.
So it became the accepted ticket and the accepted phrase: "You need a college degree to get anywhere today." So it was until recently.
Now, in the information age, the poorest of kids in 3rd world country can find access to any information they want via the internet. Of course primary school fundamentals are critical so that those kids have the basic tools so that they are able to learn advanced things. So it's now almost gotten to be that the "You need a college degree to get anywhere today" has changed to "Getting a college degree mostly indicates that you have the tenacity or patience to pursue and complete a 4 year program of dealing with an institution and following their rules to a project completion." This may be of value to getting the low-level administrative jobs common to very large institutions such as government, academia, large corporations, military.
It seems that the traditional "non-technical" jobs, let's say a welder or an automobile mechanic today require a lot of training to both enter and stay current with the technologies that they deal with today compared to 50 years ago.
But the "technical" job requirements seem to be changing to less and less requiring a 4 year engineering or science degree since in a large population (e.g. the U.S. of 300+ million) more specialization occurs and hiring companies want someone who is very knowledgeable in their specific field so they can benefit from the new hire right now, not invest 20 years into developing them. Technologies are changing too fast to use the old employer/employee 40 years and gold watch approach.
An example would be batteries --- 100 years ago essentially all wet acid-lead or dry zinc-carbon. Now there are many more efficient varieties, lithium-ion, solar cells, ultracapacitor, etc., and more to come. A kid with a high school education, a couple of years of community college to get a bit more of the chemistry and math needed, a PC with a home internet connection, and the 20-year old can bypass sitting in college classrooms learning a whole bunch of other stuff they're not interested in and will never use. And the free market will place a high value on these kids to prospective employers who need them RIGHT NOW to help them with further development of their cutting edge improvements. You see a lot of this with coding by non-4-year-college degreed kids being gobbled up by companies because, well, they can write code that they need. No talk of a 4-year degree in computer science.
But back to the topic of the day, the admissions scandal, it does make one scratch their heads why the elite, who can bequeath to their kids millions rather than the kids needing to get a 4 year degree to --- do what with it? I guess just to buy prestige. I mean the degrees these pampered offspring were to get certainly would not be in engineering, hard science, business administration, nursing, medicine, or law.
Just to have their kid be able to one day say "Hey, I got a degree from Yale."
Over time that is becoming less and less important than being able to say: "Hey, you know when you put your ATM card in the slot? I wrote the subroutine that verifies the validity of your card with VISA and Mastercard."
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