Disagree. What we call coding today will have virtually nothing in common with what they call coding, if they do at all, at the end of the 21st century.
Just look at tools like Parse or Visual Studio Code Search. The future is going to be very, very different from the present.
This isn't always the case in CS. It is often more advantageous to your career to not take time off. Granted, someone can get a masters while working, but it's often for the purpose of a career change or promotion into a specific category of position.
Who said anything about taking time off? If the goal is to become a talented software developer, what does a hiring manager care if that was done for-pay or in school, provided the candidate got the experience and did something challenging?
I understand that there are "business" concerns (deadlines, tools, testing, and other things that aren't always taught in school) but a candidate could just as easily be deficient in those areas having worked for an employer with crap practices.
At some point companies need to stop whining and solve their own problems.