Each year, India adds millions of graduates to its talent pool. Thousands of them enter the job market, freshly certified and ready to be hired.

On the surface, the equation seems straightforward: companies need people, and people need jobs. And so, the machinery hums along—universities churn out degree holders, and employers scan resumes for keywords that signal pedigree. What goes mostly unnoticed in this process is the growing disconnect between qualification and competence.

Meanwhile, private university fees keep soaring. For instance, an undergraduate programme at Haryana’s Ashoka University now costs about Rs 40 lakh (although the institute provides financial aidThe KenLiberal-arts pioneer Ashoka University puts on B-school boots after 10 years to half the students in any batch). The prestigious Indian Institutes of Management (IIMs) are chargingThe KenThe 30 lakh IIM degree that’s not an MBA MBA-level fees for a BBA. This, when entry-level salaries have remained unchangedThe New Indian ExpressOversupply of engineers? Entry-level IT salaries stagnate at ₹3 lakh for over a decade.

In pure economic terms, the return on investment in a degree has collapsed. And yet, degrees remain the primary filter in India’s hiring process.

The problem is systemic. Faced with a flood of applicants, most companies don’t have the bandwidth to assess skills. So they outsource judgment to algorithms. Applicant Tracking Systems (ATSes), led globally by players like Oracle, SAP, Workday, and Greenhouse, have become gatekeepers. In India, platforms like Taleo and Successfactors dominate. But ATS is less about merit and more about manageability. When a handful of systems determine how resumes are filtered, recruitment becomes less about talent and more about pattern-matching.

The bias is because pedigree acts as a hedge against bad hires—the kind that do not fit in. That’s where skills gain prominence. 

A February 2025 report from job portal Foundit (formerly Monster) found that 14% of active job postings in India no longer require a formal degree. The shift, albeit marginal, points to growing awareness. A World Economic Forum reportWorld Economic ForumFuture of Jobs Report 2025 also said nearly 30% of Indian companies are adopting skill-based hiring, removing degree requirements.