Companies Can Ameliorate the Student Debt Crisis Without Spending an Extra Dime

This article originally appeared on the eightfold.ai blog

Why do we get an education?

When I ask people this question, I receive a variety of answers like, “that’s just what we do!” or “so young adults can find out what interests them.”

While these answers are true in a sense, they’re too superficial. The ultimate purpose of education is to make a living, and there is a measurable correlation between an education and an income. Unfortunately, simply getting an education is not enough — where you graduate from carries significant influence. Malcom Gladwell highlighted this well in an episode of Revisionist History, when he referenced an interview with the late Justice Antonin Scalia at American University’s Washington College of Law.

“When picking for Supreme Court Law Clerks, I can’t afford a miss. So I’m going to be picking from the law schools that are the hardest to get into, that admit the best and the brightest –- they may not teach very well, but if they come in the best and the brightest then they’re probably going to leave the best and the brightest.”

Justice Scalia’s statement represents the traditional way hiring managers filter their recruitment. This approach clearly overlooks the quality candidates who attend lower-ranked universities for a variety of reasons, but the cost of seeking out these candidates has historically outweighed the benefits.

This antiquated approach needs to be overturned, and the technology is available to do so in a scalable manner.

Companies Are Incurring the Cost of Rising Tuition

When I graduated from Georgetown University nearly a decade ago, I had approximately $200,000 in undergraduate debt. Fortunately, I had offers from companies across three different industries: consumer banking, international consulting, and consumer goods. In hindsight, I should have selected international consulting because it better aligned with my personality and growth mindset, but instead I selected consumer goods because it paid the most and appeared to have the highest potential for income growth.

My career headed down a very different path, and it cost me several years of unfulfilling work. But as I look back, I believe that the international consulting company was a casualty of the rising debt crisis, too. It lost a qualified candidate solely because it could not pay what I needed to satisfy my inflated cost of living due to federal and private loan payments. In the years since then, my income has more than doubled due to my work ethic and performance, but I still filter potential employers based on whether they will pay me enough so that I can continue paying off my Georgetown debt. I have met dozens of colleagues who also consider their loan repayments when evaluating an employer.

This unlocks an interesting observation: universities are charging students more in tuition, but companies that attract talent from top universities need to pay these employees more to make up for the increasing cost of a bachelor’s degree.

Why aren’t companies fighting back against this domino effect?

Invisible Talent

When the late Justice Scalia spoke at American University’s Washington College of Law, he elaborated on what he looks for when picking a Supreme Court Law Clerk by sharing this story:

“One of my former clerks, who I am the proudest of, now sits on the 6th circuit court of appeals. Jeff Sutton. He [initially] wasn’t one of my clerks, he was Louis Powell’s former clerk. But I wouldn’t have hired Jeff Sutton –- he went to Ohio State! But he’s one of the very best law clerks I ever had, he is a brilliant guy.”

Even though Justice Scalia empathically expressed that he recruits from top universities because it improves his hit rate on finding top clerks, he recognizes that his best clerk did not attend a top university and therefore would have been overlooked! This story affirms the comment that Jennifer Carpenter, VP of talent acquisition at Delta Air Lines, made: “A candidate’s potential is far more relevant than any skill pedigree they may show up with.”

Why would someone with potential to have a successful career not attend a top-tier university?

A second reason why a high-potential candidate may not attend a top-tier university is because of the cost.As this mother expressed in 2016, her son was accepted to the University of Wisconsin (ranked #46 in national universities) but, when he did not receive any financial aid, had to make the difficult decision to attend Rutgers University (ranked #62) instead. His classmates who were admitted to Johns Hopkins (ranked #10) and Carnegie Mellon (ranked #25) also chose Rutgers because they could not afford to take on the debt of those private universities.

This raises an essential question: if the “best and the brightest” are electing to forgo top-tier universities because it would not be financially responsible to do so, then don’t companies have a duty to meet these students where they are rather than cast them out of consideration because they did not take on debt?

How AI Can Broaden the Scope of Hiring Without Incremental Cost

When I graduated from Georgetown, the best way to get noticed was to attend a career fair and meet your potential employers in person. The online portal was clunky and suboptimal because it felt like I was throwing my resume into a void. Almost 10 years later, video conferencing and automated interview technology is making it possible for the same companies to virtually reach students on hundreds more campuses without incurring incremental costs. A larger reach means more applicants, but artificial Intelligence can amplifying HR professionals’ capacity to evaluate candidates, and can integrate evidence-based models of working to reshape the workforce.

Through predictive analytics, AI-powered hiring technology can help hiring managers strategically find capable candidates who may otherwise be overlooked due to unconscious bias. This technology can benefit a company’s hiring practices throughout all levels of hiring, meaning the cost of applying this approach toward recent graduates would be nominal. The benefits, however, will be far reaching and can ameliorate the student debt crisis because students will no longer believe that they must pay $70,000 per year, including living costs, to attend a university that will get them noticed by top employers.

Emotional Health | Student Debt | Career Advice. Repaying my student loans w/ a proprietary method & helping others save tens of thousands too. Let’s talk debt!

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