Just to state the obvious, if, in a certain civilization, you can only find employment "if you know someone," which is to say, through back channels rather than the front door, the civilization is corrupt. Gaining a position through these sorts of personal contacts should be the exception rather than the rule, and only done in certain circumstances. The practice becomes more general because the people involved, instead of working for the exclusive benefit of their company or organization, are looking to strengthen their own relationships, and giving jobs and providing access to jobs are ways of increasing their private social capital.
Another consequence of industrial prosperity. It's not just that it's not a meritocracy -- it's also not a desperate fight to find the fittest, as the only way to get a position is to be the opposite of competitive towards contacts and potential contacts.
Lamentable, yes, but lamenting things gets us nowhere. Increasing the respect for degrees might be one tactic (the phrase "academic citizen" for those holding a first university degree is common in parts of Europe), but given the corruption at the universities, that's difficult. After structural reforms there, perhaps: compulsory outside examiners for advanced degrees, outside scorers for term-end examinations or papers, formal procedures for hearing intramural claims of right rigorously observed, etc.
But there as well, those involved are rent-seeking. And rent-finding. (And they complain when their own rents get too high.)