Rising tuition costs and increasing student debt, coupled with concerns about AI’s impact on the workforce and the need for skilled trades are prompting students and their families to reconsider the traditional route of a four-year degree. Learners increasingly gravitate toward hands-on trades and flexible career paths that can evolve, challenging the long-held belief that a college degree is the optimal path to a stable employment future. AI education and digital credentials are creating alternative pathways for learning and validation of knowledge. Education companies are positioning themselves to take advantage of these new developments.
AI Education And Shortcomings Of Traditional Degrees
The high cost of education has prompted many to rethink the value of undergraduate degrees. Simultaneously, AI’s potential to disrupt traditional aspects of the knowledge economy has encouraged students to pursue skills that are less likely to be automated. This climate of change has sparked a career pathways mindset, with increasing skepticism about the long-term ROI of a college degree.
President of Universal Technical Institute, Tracy Lorenz, notes that “Gen Z increasingly views careers in the skilled trades as a more practical and rewarding alternative to traditional career paths.” The move into the trades is not driven by a move away from technology. Instead, technology is a key driver, with platforms like TikTok and Instagram filled with creators sharing their work in fields like automotive tech, welding, and HVAC, showing the rewards of these careers. Lorenz notes that “For a growing number, the skilled trades may offer a faster path to a career that aligns with their interests and goals.“ Additionally, the fact that these trades increasingly rely on information technology increases their appeal, especially to a generation that has grown up using digital tools.
Beyond costs and career outcomes, students confront the challenge of identifying their genuine interests and distinguishing them from what they’ve been told they should pursue. This is particularly challenging given that for much of the last two decades, phrases like “every student, every day, college-bound” have echoed throughout public schools. This is where real-world experiences and aptitude assessments can help students align personal strengths with viable career paths.
Edson Barton, CEO of YouScience, said, “80% of the class of 2023 would have been more engaged in learning if they had understood their aptitudes (or innate natural talents) and how those align to career opportunities.” Whether a student prefers a skilled trade or a more technology-driven field, aligning interests and abilities with career goals is essential. Consequently, there will be an increased focus on integrated real-world job experiences, apprenticeships, and various career exposure opportunities designed to help students better determine which potential future suits them best.
YourScience Director of Workforce Development, Peter J. Van Mondfrans, anticipates that “In 2025, Apprenticeship and on-the-job training programs will expand into sectors traditionally dominated by degree-based qualifications as employers increasingly value practical, hands-on experience. We’ll also see a rise in the popularity of micro-credentials and short-term certifications, offering an accelerated path to in-demand careers without needing a traditional four-year degree.”
Short-term courses, micro-credentials, and targeted certification programs provide a practical alternative or complement to the four-year track. For many, these faster, industry-aligned pathways are more attractive than a traditional academic route.
AI Education And Digital Credentials Will Require Universities To Reinvent Themselves
Far from becoming irrelevant, universities have a pivotal opportunity to reinvent themselves by aligning more closely with workforce needs and supporting learners throughout their careers.
Sara Leoni, Founder and CEO of Ziplines Education, sees 2025 as the time when greater focus will need to be paid to the role of universities in workforce development. “How can universities better align their offerings with the needs of industries disrupted by automation and AI? What steps can be taken to design flexible, high-impact programs that not only meet local labor demands but also provide professionals with the digital fluency required to thrive in a tech-driven economy? By focusing on these considerations, universities have an opportunity to position themselves as essential partners in shaping the workforce of the future.”
From a business standpoint, universities that expand their services beyond the traditional four years of undergraduate plus one or two years of graduate school can widen their market. By offering lifelong learning—whether for professional development or encore programs for career reinvention—institutions can remain central to workforce development at every stage of a person’s working life.
AI Education And Digital Credentials: Key Enabling Technologies
As the focus shifts from formal degree programs to combinations of courses and experiences, tools will be necessary to manage learning as individuals progress through their educational journeys and advance in their careers.
Ryan Lufkin, Vice President of Global Strategy at Instructure, articulates a clear vision for the transformative power of technology in making it possible for students to dial in their pathways leading to careers. “We’re likely to see technology such as AI empowering learners to take control of their educational journeys. These AI-supported learning journeys will include a deeper understanding of where students want to go while providing recommendations for getting there. AI will be able to help learners build a plan and advise them on how to build the knowledge and skills they’ll need. We can take this a step further, connecting to the job market and informing students on the paths that lead to well-paying and in-demand career opportunities. AI will drip-feed microlearning to workers, ensuring they stay ahead of emerging technologies and changes in the skills they need to be successful.”
Although AI has already been integrated into workplace learning, the coming years will see it evolve into a more proactive force in career management, assisting learners in navigating transitions, adapting to new roles, and uncovering hidden strengths. Darrin Murriner, CEO of automated coaching technology company Cloverleaf, anticipates deeper conversations surrounding AI’s role as a personalized career partner. “While AI is already being used to scale and customize workplace learning, 2025 will mark the beginning of discussions about AI as a proactive force in career management—helping individuals not only build skills but navigate transitions, adapt to new roles, and even uncover hidden strengths.”
AI Education And Digital Credentials Validating Learning
For these transformations to succeed, students must have a way to communicate clearly with future employers about what they’ve learned and the specific skills they’ve gained. AI systems can facilitate the interoperability of records, but for these systems to achieve their full potential, the appropriate tools must work with the right data in a portable and verifiable manner.
Manoj Kutty, the CEO of Greenlight Credentials, has developed a system that leverages a blockchain-secured distributed ledger to provide students with portable records they can share with prospective employers. Employers, in turn, can verify the authenticity of these records and better understand a student’s unique accomplishments. Greenlight also goes further by using AI to prepare a student for their careers and find a job—everything from pathways and course selection strategies to job interview simulations to matching them to available jobs—ensuring a relentless focus on the student’s ultimate goal of employment rather than merely earning a degree.
As knowledge becomes increasingly disconnected from traditional degree programs, flexible systems for earning, tracking, and verifying skills will become ever more essential. The growing interest in skilled trades does not imply that learners will cease formal or academic learning altogether; rather, students will begin by considering the jobs they aspire to and then determine the best paths to those careers, focusing on the return on investment. In the realm of skilled trades, students may discover that micro-credentials can provide faster, more affordable, and equally fulfilling pathways to employment. Universities will maintain their relevance by aligning programs with workforce needs and offering robust, ongoing professional development, as well as opportunities for mature workers to reinvent themselves through encore programs. As the education ecosystem becomes more varied, the traditional transcript, which lists completed courses and received grades, will need to be replaced by a comprehensive record that accurately details what was studied and what students accomplished. Blockchain-secured and AI-driven tools can assist learners in sharing and verifying their skills efficiently, fostering a more transparent and dynamic job market. Ultimately, AI education and digital credentials may succeed in finally liberating the acquisition and validation of knowledge from the university degree establishment.