Employers, candidates grapple with the implications of artificial intelligence

With talent remaining difficult to acquire, employers are scaling back their educational requirements for new hires. But a new factor appears to be influencing this collective decision: the rise of artificial intelligence as a substitute for a degreed education.

That’s what Cengage Group found when it queried 1,000 hiring decision makers for the 2023 edition of The Employability Survey.

Cengage also surveyed 1,000 individuals who had attained some type of formal educational degree. It asked them, among other questions, what effect artificial intelligence tools such as ChatGPT had on their preparations for employment. The answer: Quite a bit.

One of the survey’s major findings is that 50% of employers now say they’ve dropped 2- and 4-year degree requirements for entry-level positions–up 32% over 2022’s response. Two-thirds of these employers are prioritizing softer skills and previous job experience. And employers are also targeting certain roles for machines, not humans, going forward.

“The workplace has changed rapidly in the last few years, and now we are witnessing a new shift as AI begins to reshape worker productivity, job requirements, hiring habits and even entire industries,” said Michael Hansen, CEO of Cengage Group, in a press release. “With new technology comes both new uncertainties and new opportunities for the workforce, and educators and employers must do more to prepare today’s workers for these technological shifts.”

Among the trends spotted in the employer survey:

• The struggle for talent is still very real. But it has abated. Asked if they were struggling to tap into the available talent pool, 53% said  they were. But that’s down from 65% in 2022.
• Employers have become more willing over the last year to interview candidates with experience but no degree. 
• Nearly half are hiring talent with some but not all the skills needed for a role. Instead, they intend to upskill them.
• More than half of employers (57%) believe certain entry level jobs, teams and skills could be replaced by AI. 
• More than two-thirds of employers (68%) say many of their employees will need to reskill, upskill, or outskill in the next 3-5 years because of emerging technology.

The implications of the AI evolution are not lost on recent graduates. As employers drop job requirements, “Grads are more confidently applying to jobs with 61% of employers seeing an uptick in non-degree applicants.”

Those applying for entry level positions “are feeling more confident regarding their qualifications to apply for entry-level jobs, with only one-third stating they felt underqualified, down significantly from the last two years in which roughly half of graduates felt underqualified.”

But these same budding employees are concerned about AI’s longer term impact on their working lives. 

• Half of graduates feel threatened by the growth of AI (46%) and question their workforce readiness (52%). 
• They view AI as undermining their college degrees. “The need for continual learning is making many grads question the value of a college degree and why it’s required for an entry-level job,” the study said.
• Only 41% of grads said their degree program prepared them for their first job, down from 63% in 2022.
• Only 47% participated in internships, apprenticeships and hands-on learning programs this year, compared with 63% in 2022. 

“No part of the workforce is immune to the changes AI will bring,” said Hansen. “Many workers will need to develop new skills to work alongside new technology or perhaps even find new careers as a result of AI disruption. As we collectively navigate these changes, we are laser-focused on helping people develop in demand skills and connect to sustainable employment.”