Graduates’ earnings in America-Britain fell by 10% in 4 years:Not degrees, but skills, technology and AI are changing the job market

New data from the US and UK suggests that the salary advantage for college degree holders compared to non-graduates is declining. According to research by economists José Azar, Mireia Giné, and Xavier Giroud, the wage premium for college graduates in the US has fallen consistently over four years. The total decline is approximately 10%. This is considered the first major drop since the 1970s.
For the first time in over 100 years, the demand for graduates is decreasing. In the UK, too, the advantage for those with degrees in Science, Technology, Engineering, and Mathematics (STEM) is diminishing. AI is specifically transforming those white-collar and knowledge-work jobs that have long been dominated by graduates. In India, the number of degree holders has increased, but jobs have not According to the State of Working India 2026 report by Azim Premji University, the number of graduates among the youth increased from 10% to 28% between 2004 and 2023. However, jobs are not being created in proportion to the increasing number of graduates every year. About 5 million new graduates enter the job market, while only about 2.8 million jobs are created. Now, about two-thirds of unemployed youth are graduates. Survey – 70-90% of employers are hiring based on skills In a report by the National Association of Colleges and Employers in the US, about 70% of employers are now hiring based on skills. A Forbes report states that 90% of companies now hire based on skills rather than degrees. 94% of employers believe that skill-based hiring is better than hiring based on degrees, certificates, or experience. Change – The requirement for degrees is decreasing in many countries Country – Decrease
US – 3.9%
UK – 1.8%
Australia – 1.6% (Source – Boston Consulting Group)