Using longitudinal data on university leaver cohorts in the period from 2006 to 2016, we investigate the impact of the Bologna reform on Swiss graduates’ returns to higher education. Drawing on the job market signaling model, we expect lower returns for graduates who enter the labor market with a bachelor’s degree. Moreover, we expect that the initial wage difference between bachelor and master graduates will become less volatile over time, since employers constantly update their beliefs about graduates’ employability. Controlling for selection into employment and a number of different signals sent by the graduates, we find a persistent advantage of a master’s over a bachelor’s degree. The new degrees, and especially a bachelor’s degree, did indeed serve as a noisy signal about graduates’ productivity in the first years of the Bologna process.