India’s skills vs degrees debate: Three recent arguments about higher education point to the same problem. India may be asking the wrong question when it pits skills against degrees.
The argument returned in July when Principal Economic Adviser Sanjeev Sanyal, Chief Economic Adviser V. Anantha Nageswaran and fund manager Saurabh Mukherjea questioned the value of conventional college degrees. The scepticism found an audience. Graduate unemployment among 15–25-year-olds is roughly 40%, while India Today reported on July 20 that IT-sector layoffs had crossed one lakh in 2026.
There is an awkward question for government. Its own departments and public-sector companies still recruit overwhelmingly through educational qualifications. If skills are a better measure of ability, government hiring should have been among the first places where the degree filter weakened. It has not.
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The skills vs degrees argument breaks down quickly
The advice also makes little sense when applied uniformly. The India Skills Report 2026 puts employability among Computer Science and IT graduates at about 80%, against roughly 63% for Commerce, 61% for Science and less than 56% for Arts and Humanities.
That spread says more than the average. A computer science graduate and a humanities student do not face the same labour market. Nor does a short-term skills course substitute equally well for structured education across disciplines.
The stronger question concerns the quality of the degree. A poor degree may have little market value. That does not make the degree itself redundant. Too many colleges have weakened the credential by teaching badly, offering outdated courses or admitting students without delivering commensurate learning.
Hiring practices compound the problem. Skills programmes will remain secondary as long as employers continue to use degrees as their first screening device. This is especially important for young people without family networks, elite-school backgrounds or prior work experience. They need a credential because employers need a signal.
The apparent opposition between credentials and expertise also collapses at the upper end of the skills market. Much of the work at the frontier of artificial intelligence is being done by people with advanced university training, often doctorates. Deep expertise still requires long periods of structured learning.
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Even computer science graduates face a tougher market
Computer Science and IT appear better placed than other streams. Even there, the labour market is changing faster than the degree.
The foundit Insights Tracker for July 2026 says IT’s share of fresher hiring fell from 32% to 24% over the previous year, although the broader IT occupation index rose 10%. Employers were adding experience rather than entry-level numbers. The 7–10-year experience group was the only cohort to grow.
Fresh graduates who do get hired are also being sorted more sharply by specialised skills. AI-related jobs now account for about 4% of fresher hiring, against roughly 1% in 2025. Operational roles such as data analysis, prompt engineering, AI quality assurance and testing account for 51% of entry-level AI recruitment.
Pay shows the same sorting. Two-thirds of entry-level jobs pay less than ₹5 lakh a year. Only 12% cross ₹8 lakh, with the better-paid jobs concentrated in AI, data science, cybersecurity, semiconductors and product engineering.
The computer science degree still matters. Its market value increasingly depends on what the student can do with it.
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Why degree education still matters
A discussion at JETRI Dialogues on July 30 brought out another weakness in the skills-first argument. Careers360 founder Maheshwer Peri described the dismissal of credentials as a position shaped by privilege.
That matters. A young person in Delhi or Mumbai with family contacts, good English, internships and access to employers can demonstrate ability in many ways. A first-generation graduate from a small town may have only the degree certificate.
At scale, employers cannot personally assess every applicant’s skills. They use credentials because credentials reduce the cost of screening. The degree may be an imperfect signal. For millions of applicants, it remains the available one.
Mayo College principal Saurav Sinha raised the other side of India’s education hierarchy: the enormous number of students who spend years preparing for institutions such as the IITs and fail to enter them. The education system is organised around the tiny share that clears the funnel. Much less attention goes to the much larger group that does not.
This makes the skills-versus-degrees argument look very different depending on where a student starts. Those with networks and financial security can take greater risks with alternative credentials. Others need recognised qualifications because labour markets still demand them.
Telangana now offers another warning. Of 4.37 lakh undergraduate seats available across more than 900 colleges, 2.66 lakh remain vacant this year. The numbers can easily be read as evidence that students are abandoning conventional degrees.
Telangana Council of Higher Education chairman V. Balakista Reddy offered a different diagnosis in an interview with The Hindu on August 3. His argument was for reforming degree education rather than replacing it with narrow vocational courses.
That is closer to the problem revealed by the empty seats. Students are questioning the value of degrees whose cost, curriculum and employment prospects no longer add up. Employers simultaneously continue to demand those same credentials.
India therefore has two problems that are often collapsed into one. Many degrees provide too little learning. The labour market still gives people without degrees even fewer chances.
The degree survives because India has not built a credible substitute for the signal it provides. Empty college seats, weak graduate employment and the spread of skills courses all point to the same unresolved issue: whether higher education can provide useful learning to the large majority of students who will never enter an IIT, acquire an elite network or walk into a high-paying technology job.
That is the constituency for which the degree system has to work.
Krishna Uppuluri is a development professional, educator, and research scholar whose work explores the intersection of public policy, governance, rural development, and institution building.