It is also important for employees to be conscientious and conformist. And while we can accurately assess someone's intelligence with a short IQ test, it's a lot harder to find out how conscientious and conformist someone is.
As he goes on to say, someone with the intelligence to go to college who passes up the opportunity is sending a signal of independence, which may be a contrary indicator for employers.
Along the same lines, education provides a signal about your support for credentialism--the belief that only people with proper credentials should be hired. If you go to college, you implicitly support credentialism--or at least you do not reject it. If you refuse to go to college, then you show disrespect for credentialism. That disrespect may represent a threat to hiring managers who are credentialist.
I remember hearing a company founder in the Dotcom era saying that he only wanted to hire MBA's from top schools. I thought to myself that this was silly. When you are a start-up, you need to find people who are better than their credentials. The last thing you can afford to do is pay a premium for credentials. But this guy, who had an MBA from a top school, was evidently uncomfortable around people with more talent than credentials.
One would expect credentialism to be strongest is in fields where credentialism is crucial to income. Professors and teachers would be strongly credentialist in their hiring philosophy, because without credentialism, formal education loses some of its value.
The more you want people to place a high value on your credentials, the more you will want to reward people who are credentialist and punish people who are not. If you are trying to use your Harvard MBA credential to climb the corporate ladder, then you want to hire people who are impressed by Harvard MBA's, and you would feel threatened by people who are not impressed by Harvard MBA's. And who would be more likely to respect the Harvard MBA credential than someone with a similar credential?
Thus, you have the credentialism trap. Once people who are credentialist have power, then everyone who wants power has to bow toward credentialism.
My Dotcom era example notwithstanding, I believe that the trend toward entrepreneurship may start to undermine credentialism. In addition, as economic change accelerates and people have to change careers more often, credentialism will be too large a source of friction.