Artificial intelligence is changing how industries operate, and younger generations are starting to see the shift more clearly than ever. For many Gen Z graduates, the promise of a degree no longer guarantees job security. Unemployment rates among recent graduates are climbing, raising a difficult question: is formal education still worth it, or should students focus on skills instead?

Degrees and Skills Should Work Together

Hugo Sarrazin, CEO of Udemy, believes the answer lies somewhere in between. “It’s cohabitation,” he explained. “You start with a degree, it gives you a foundation, but you need the skills to stay relevant in the workplace.”

Sarrazin calls it “silly to think” that what people learn in their early twenties can sustain them for life. Instead, he believes learning should be a lifelong journey. “We need to move to a world where there’s ongoing, continuous evolution of the skills portfolio that one has to be adapted to the jobs that they want in the market that they’re in,” he said.

Even as the leader of a nearly billion-dollar online learning company, Sarrazin insists he still values higher education. With three degrees, including two from Stanford, he says university taught him something timeless: how to think.

The Skills That Matter Most in an AI-Driven World

As technology evolves, so do the skills required to thrive. Udemy’s 2026 Global Learning & Skills Trends Report highlights adaptive skills such as judgment, curiosity, flexibility, and risk tolerance as essential in today’s workplaces.

The report notes that becoming “AI ready” is about more than just technical know-how. “It requires the ability to ask the right questions, to know when to rely on AI (and when to press pause), and to foresee impacts beyond the immediate,” it states.

LinkedIn’s research supports that view, identifying AI literacy, adaptability, conflict mitigation, process optimization, and innovative thinking as the fastest-growing skills professionals need to succeed.

The Enduring Value of Higher Education

Despite the growing importance of practical skills, degrees still carry significant long-term value. According to the Education Data Initiative, an average bachelor’s degree offers a lifetime return on investment of 682%. While it may take around 11 years to break even, the benefits compound over time through better job prospects and higher earnings.

Sarrazin acknowledges this but emphasizes that a diploma alone will not guarantee success. “University is a launching pad,” he said. “Then, after that, we need to ask what we do to prepare people to work and be successful. And I think skills become really, really, really important.”

Blending Knowledge with Adaptability

In the end, Sarrazin’s message is clear: education should be seen as a foundation, not a finish line. The world of work is changing faster than ever, and the only way to keep pace is to blend formal knowledge with adaptability. In the age of AI, success belongs to those who never stop learning.