Employers expect AI to raise the value of college degrees more often than lower it

College degrees may become more valuable, not less, as AI spreads through the workplace—at least in employers’ expectations. A Lumina Foundation–Gallup survey released October 20 found that 48% of employers expect AI to make degrees more important over the next five years, compared with 26% who expect their importance to decline.

The findings come from an August online survey of more than 2,500 people who make hiring decisions at their organizations. This was the second annual employer study from Lumina and Gallup, according to Higher Ed Dive. It captures the views of people choosing candidates, rather than measuring changes in employment or graduates’ earnings.

A stronger degree, not a disappearing one

Overall, 73% of surveyed employers expected degrees to remain at least as important as they are today amid growing AI use. That group includes the 19% who expected degrees to become much more important. At the other end, 8% expected degrees to become much less important over the next five years.

The outlook was not uniform across industries. Business and professional services had the largest share expecting degrees to become less important, at 37%. Leisure and hospitality followed at 34%. Even so, large majorities across industries expected degrees to be at least as important as today. The disagreement concerns how much credentials will matter, not a shared expectation that they will fade.

That preference was stronger at large organizations. Among employers with fewer than 10 employees, 62% of hiring decision-makers preferred college graduates. At the largest organizations, the share was 86%. Degrees therefore retained an advantage in respondents’ stated preferences even when the position itself did not call for one. That is distinct from saying a degree was required to apply or get hired.

Employers also expressed substantial confidence in the institutions awarding those credentials. Sixty percent said they had a great deal or quite a lot of confidence in higher education. Confidence varied by organization size: 44% among employers with fewer than 10 employees, 70% at organizations with 500–999 employees and 59% at those with 1,000 or more. The pattern was not simply a steady rise with company size.

What employers see in the credential

Courtney Brown, Lumina’s vice president of impact and planning, offered a skills-based explanation. She told Inside Higher Ed that employers put a premium on judgment, critical thinking, communication and adaptability. Brown described those as skills students gain through degrees, and characterized employers as hiring for abilities AI cannot provide. That is her interpretation of what underlies the preference.

She was less certain about why larger employers favor graduates more strongly. Brown suggested a degree might serve as a useful filter for companies sorting through large applicant pools to fill multiple positions. She presented that explanation as speculation, not a finding demonstrating why employers make those choices.

Brown also cautioned colleges against treating employer confidence as permission to stand still. Institutions must ensure graduates possess those lasting skills, she said, and that a degree represents real value rather than merely a piece of paper. Her warning puts a condition on the reassuring results: confidence in a credential still needs to be matched by what graduates can do.