I've been looking for this answer for 25 years. I could never understand why businesses cared about college degrees.
By the 80's, a high-school diploma was essentially worthless as an indicator of basic literacy. Now, in 2013, a BA is not necessarily evidence of being able to read, write, and think.
But we are at a point where there would be extreme pushback against requiring a Masters degree for entry-level jobs, so the whole idea of using a diploma as a substitute for tests and references may have reached its limits.