Busting The College Credentialing Monopoly

Our education and credentialing system is a historical artifact. The information age has moved libraries from the universities to the internet. Education is more available than ever before. Yet for many fields, credentialing remains in the sole hands of colleges and universities.

It is expensive to educate in the higher education system. Why do students incur a cost which may take decades to recover from? Education is important, but you can learn in many different and more affordable ways. The secret lies with the degree. For many, college feels compulsory because it holds a monopoly on credentialing. Without a degree, you often can’t win an interview, much less get hired. We need a new system which breaks credentialing away from universities’ monopolistic grasp.

By splitting the education and credentialing systems, individuals and employers both benefit. Applicants are free to learn in alternative and more flexible ways. Apprenticeships, self-learning, trade schools, bootcamps, and more become viable options to amass knowledge and ability. Employers also get to source trusted talent from a wider pool of capable individuals. A new system can provide these benefits and more.

Properties of a Functional Credentialing System

Employers face an information gap between an applicant’s perceived value and actual value. Trusted third parties seek to collapse this gap by issuing credentials, which independently verify ability. Credentials are also an asset for an applicant who can be better compensated for proving a less risky candidate.

Closing the information gap is a multi-partite process. First, employers perceive a value of the credential and credentialing agent. Our first two properties will represent this process. Then, the perceived knowledge provided by the credential maps to the actual knowledge of the applicant. Good credentials correctly represent ability, bad credentials misrepresent it. Our third and fourth properties will represent this. Our fifth and last property ensures this formula can apply across the workforce.

1. Credentialing organizations must be trustworthy.

Credentials which are not trusted will fail to allow an employer to perceive ability in a candidate. The university system establishes trust by competing in a market of reputation. Collegiate reputation is afforded to those who graduate the best and brightest applicants.

In an alternative system, credentialing agents should compete in a similar way. However, because they need not be exclusive like colleges, credentialing agents’ reputations would not be based off what applicants they credential, but how well the credentials represent ability. Good reputation is bestowed to those who do an accurate job of measuring applicants, and the market dynamics allow for competition of methods.

2. Credentialing organizations should be comparable.

Employers must be able to compare different credentials to compare individuals. The enormous number of colleges and universities make comparing degrees difficult. An alternative system should have fewer credentialing institutions. Because credentialing takes fewer resources, this could happen naturally when split from education.

Examining institutions could handle more people than educational institutions like colleges. If everyone had access to the top exams, the market would dwindle to those most reputable. For example, there are few personal training certifications in the United States. Gyms are able to know the reputation of each, compare, and hire as appropriate.

3. Credentials should be granular in both depth and breadth.

Colleges issue degrees in four main tiers: associate’s, bachelor’s, master’s, and doctorates. These degrees also represent different fields (or majors). Rather than provide trust in knowledge and ability directly, college degrees do this by using education as a proxy.

An alternative system could improve by use scoring across more subfields and would measure ability rather than certify education. Colleges themselves differentiate ability for admission based on scores. Tests like SATs, ACTs, LSATs, GREs, and MCATs provide precision in more categories than they would with four tiers of “Bad,” “Fair,” “Good,” and “Excellent.” In the current system, someone might have a bachelor’s degree in Computer Science. A new system could score across Machine Learning, Programming, Computer Vision, and more.

4. Credentials should reflect someone’s skill over time.

College degrees last a lifetime. The knowledge acquired from a bachelor’s degree in Economics, Neuroscience, or Petroleum Engineering from decades ago might be considered outdated today.

That a person with that degree is still useful in the workplace is a credit to their years of experience. An alternative system should consider changes in the field and of the individual. They could use continuing education credits, fading scores, work-reviews, or other methods.

5. Credentialing should be independent of the source of one’s education.

Some universities offer credit for work experience, but the limitations are too great. College, apprenticeships, self-learning, and work can all yield capable individuals.

An applicant might have spent decades working in a field where they have acquired doctorate-level knowledge. They may not have a degree, but credentials ought to represent ability, not the source of ability.

The Future of Credentialing

In summary, a proper system for credentialing should be trustworthy and comparable, making the system useful. It should be granular and change over time, allowing it to best map perceived to actual skill. Finally, it should be independent of education, which makes it inclusive for more of the workforce. By being useful, accurate, and inclusive, an alternate system would more efficiently place people in the roles for which they are best fit.

Envisioning single day multiple-choice tests lacks imagination. Methods for implementing substantive tests would vary. You could imagine days-long or weeks-long exams. Or, to disincentivize cramming, the process might require several weekends of testing across a year. They could have written sections, oral examinations, and lab practicals. If simple testing is not sufficient to certify knowledge, then testing procedures would evolve. Institutions with the most trusted approaches would win in the market of reputation. 

Some might lament that college is useful for other things besides credentials.This is true, but a straw-man for the argument at hand. People can and will find formal higher education enjoyable. They will make friends and future business connections. Undergraduates will mature into adults and learn to live alone. All these benefits are true for an on-campus college experience, but they can also be true outside of the system. An alternative system does not mean an end to college; people will still find value in attending for these benefits. It means that the monopoly on credentialing would be ended.

This system does not directly affect how education is delivered, but the second order effects will. All the people in the country who currently cannot afford four years of college may be better able to afford individual classes. In the current system, taking one-off classes is rarely worth it as one class does not buy a credential. In a new system, people will have an incentive to continue learning while on the job. They could take night or weekend courses to supplement their work, and each increase in tangible knowledge could allow them to increase their credential. This means more and continued education for millions who might otherwise forego college. Rather than accruing debt and losing time, people can further their careers and make education a life-long pursuit.

From an employer’s perspective, new credentialing institutions could more precisely rank candidates. This is more information, less risk, and better placement of employees. For individuals, there would be a great amount of new educational and financial flexibility. Rather than incur debt, one could work in their field, make money, and earn credit for real experience.

Change is not easy, but we need not start from scratch. A new system could emerge parallel to the existing one. They could be borne from the colleges, issuing college-equivalency degrees. Existing credentialing organizations could also expand their purview, like the American Bar Association, the Educational Testing Service (GREs), or the College Board (APs, SATs). No matter how it’s accomplished, there are changes we must make. Doing so will allow employers to best select employees and will liberate individuals to educate in more diverse and affordable ways. It’s a new millennium, and our antiquated system needs change.

Published by Jasper

Aspiring polymath. I do my best to understand all sides of an issue. I read primary sources and opposing viewpoints to get to the truth. I enjoy debate and can change my mind given sufficient reason.

2 thoughts on “Busting The College Credentialing Monopoly

  1. I’m in agreement that a new paradigm should be developed. However, I don’t think your assumption that there will be fewer credentialing institutions needed – or fewer will emerge. Because the cost to enter the credentialing market is much lower than to create a formal school, and technology will continue to evolve making more opportunities for start-ups in this sector – you’ll find as many credentialing businesses as schools. Now you will need some sort of oversight or accreditation of these institutions as you do with education itself.

    You do cover the credential process which will also be a big issue. There are people who naturally do well on tests and those who just panic and can’t function. Your suggestion that the process would not be simple test-taking is good – and that it might be taken over a long period of time makes sense. However, this also becomes expensive and if you take it to an extreme – this is what college/university is all about. It’s a multi-year test to assure one that the candidate has a well rounded education, is constantly challenged by teachers and peers, and has the minimum competency in a subject. This is why I love the apprenticeship concept. Not only does one work directly under an “expert”. They earn money and prove their mettle.

    If you had a clean slate and could build a system from scratch. What would it look like. Universities don’t exist. Now what?

    1. The barrier to entry to create an exam is indeed lower than it is to start a school. There is room for options supply-side is what you’re saying. However, certain credentialing “tests” will inevitably gain the reputation of being better than others, and demand will funnel down into the few tests most respected in their field. And you would not need much bureaucratic oversight—reputation is dynamic and if a test started grade-inflating, it would be easy for people to transition to a more respected field. Gym’s know that a personal trainer with a certificate from the National Academy of Sports Medicine is more respected than one from the American Council on Exercise, which in turn would be more respected than one from Bob’s Gym Accreditation Service. There could be dozens of random accreditation startups supply-side, but demand would be concentrated in the few best ones.

      I agree that multi-year tests taken to the extreme can look like college, but for the fact that college necessarily includes education. I am saying that we can completely split up the education process from the credentialing process. Teaching and testing do not have to be coincident.

      From scratch, it would depend on the field. The needs of engineering are different from those of philosophy. But I would imagine a multi-week evaluation (perhaps on weekends, so people can apprentice/work during the week), that ranks people across multiple dimensions within their field (reference my want for granularity). It would include a mix of theory and demonstrated practice for those fields where it applies.

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