In terms of the working world, I don’t know what the good alternatives might be. Some professions like law and public accounting require exams and continuing education. The IT industry has many different certifications with differing levels of acceptance.
I don’t know if AI will make things better or worse. Making people take job entrance exams will probably create a lot of questions about the tests fairness and cultural biases.
I think to a large degree we use degrees as a sort of status signal. I’m thinking of those stickers people like to put in the rear windows of their cars to advertise their college affiliation.

