It's not for "signaling," and it's not for "high prestige" jobs.

It's for jobs, period. Because a) as the world grows more complex, more and more jobs genuinely require higher education, and at the same time b) with the near-total disappearance of training by employers, they expect job seekers to come into every job with all the skills needed, and with the decline in labor power (as compared to the late 20th century), there's very little meaningful resistance to that.