Agree, most people are not going to be top academics or top in the most highly paid professions.
Many people getting degrees today, still end up in the jobs they would have done 30 years ago without a degree, but perhaps one is expected in those jobs now.
Having a good degree from a highly regarded university does give more options and allow people access to those top jobs. Many people with great degrees still don't go into highly competitive industries fora variety of reasons, but they had the choice to.....that is important.
The world is a judgey place. So whether its using the place someone got a degree from, to decide if they are short listed for an interview, or just the judging we do about each other when we chat and eventually find out where other mums went to university, we all make judgements.
Certain elements of society are perhaps more aware and judgey about all this than most sections. Those working in academia are clearly very aware of it all, as are teachers in independent schools that send many pupils to top universities and those working in highly competitive professions, are also very aware of the pecking order. Probably most people never give it a second thought. Parents with teenage children making GCSE and A Level and degree choices need to be informed at this crucial stage of their childrens life.
Employers need some way to differentiate between candidates, when a highly academic person is required. Degree classification alone does not tell much of a story anymore, but institution attended still does.
For borderline candidates, going for a slightly easier to get onto course at a better university, is often better than going for a very popular course at a less well regarded place.....only applies to subjects which don't lead directly into jobs and which would give equally valued transferable skills which employers will value. I'm clearly not advocating choosing a course that a student is not suited to or won't like, but sometimes there can be a couple of grades difference in offers, for courses which have many similarities and which will be judged equally by employers.