HIGHER EDUCATION BUBBLE UPDATE: College, Earnings, And Learning:

The explanation, I submit, is that the earnings disparity is not due to the high skills of college graduates (although some certainly do have them), but rather that over the last several decades, good opportunities for people who don’t have college degrees have been vanishing. Fifty years ago, hardly any career paths in the business world were foreclosed to people without a college degree, but today we find that few career paths remain open. That is because credential inflation has set in with a vengeance. Many firms now require that applicants have college degrees, even for work that calls for nothing more than basic trainability. Thus, those who don’t have college credentials are confined to an increasingly narrow segment of the labor force where the prospects for great advancement are bleak.

Credential inflation indeed.