In the field in which I work (a combination of banking/finance and IT) pretty much everybody has a degree but almost nobody has a degree that had anything (directly) to do with their job. The exception are the PhDs who are pigeonholed in very specific jobs and aren't likely to advance corporately (such as the ethnographer who runs our user experience design group)
But there are people who don't even have a degree. They just generally started lower in the company (or discipline) and had to work their way up.
Eventually, experience and demonstration of skill trumps degree.
My current job technically has a requirement for a BS, preferably in Computer Science. I don't have that. Fortunately, the HR department here is flexible enough that when I sent in my resume (cold) they saw my years of experience as adequate. Obviously, flexibility will vary a lot from company to company and even from HR screener to screener.
I think the ever widening call for a degree of some sort (any sort) is a byproduct of the death of company loyalty and growth in employer mobility. You can debate who killed it (and, personally, I'm glad its dead) but in an age when lifetime employment is more than norm than the exception it makes sense to bring people on in more of an apprenticeship model. But in a world where the first job is just that (a first job with many more to follow t different companies) companies ask themselves why they should put the effort into training and education just so that their competitor will get the benefit when that employee moves on to better money.
So, once you get into that mindset you start looking for proxies. Some evidence of a work ethic, ability, and determination. A college degree is not a perfect proxy by any degree but it is an easy one. And not entirely inappropriate either as a starting point.
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