'Class 12 pass-outs earn more than graduates': Saurabh Mukherjea questions middle-class faith in degrees

India’s middle-class obsession with educational credentials may be failing its graduates. Saurabh Mukherjea, Founder and Chief Investment Officer at Marcellus Investment Managers, paints a stark picture: “30% of graduates in India don’t have a job.”

The numbers get grimmer—freshly minted graduates in 2024 faced an unemployment rate of 80%, with even IIT graduates struggling to find placements.

This, he argues, is the consequence of a socialist education model operating in a capitalist economy. Degrees, once seen as a ticket to success, now seem increasingly disconnected from job market realities.

Mukherjea questions the efficacy of India’s higher education system, which has been heavily funded by the government for 75 years. “We have a socialist education system in a capitalist country,” he says, highlighting a growing disconnect between academic qualifications and employability.

The International Labour Organization’s (ILO) data underscores this crisis. While India’s illiterate population has an unemployment rate of just 3%, unemployment among graduates stands at a staggering 30%. “There’s plenty of data showing that graduate education in India neither increases earnings nor enhances job prospects,” Mukherjea states.

According to him, the most financially prudent decision might be to stop studying after Class 12. “Class 12 pass-outs have the best earnings and seem to be significantly better off than those who go on to graduate,” he asserts, calling it a “hammer blow” to middle-class beliefs about education as a gateway to prosperity.

This issue is compounded by the increasing influence of AI and automation. “The more AI advances in the office and the more robotization spreads in factories, the less useful credentialed education becomes,” he warns. The relentless pursuit of degrees—BSc, PhD, IIT—has created an education system that is detached from market demands. “Much of what passes for education in India seems to be useless in the job market,” Mukherjea states bluntly.