Between 2012 and 2019, only 31% of new jobs didn’t require a bachelor’s degree or higher. But with 50% of the workforce not meeting that requirement, that means that workers without degrees severely outnumbered available roles.
But what many organizations had overlooked, is that this 50% of the workforce had developed highly valuable skills through avenues other than a bachelor’s degree.
Referred to as STARs—Skilled Through Alternative Routes—these individuals make up a valuable and highly untapped talent pool. Which is why it’s time to opt for a more skills-based hiring approach: Prioritizing skills rather than degrees when sourcing and vetting new talent.
Skills-based hiring is the best way to build teams that have first-hand experience, real world knowledge, and the hard and soft skills you need to drive your business.
So, let’s get into it.
What is Skills-Based Hiring?
To understand the value of skills-based hiring, it’s important to understand how and why this new approach emerged.
The Paper Ceiling
Essentially, the paper ceiling is when workers with in-demand, valuable skills are overlooked simply because they do not have a bachelor’s degree or higher.
Not only do these workers face the obstacle of breaking into certain industries, but they can also be overlooked for higher-wage jobs within their fields. Because of this, the paper ceiling is not only an obstacle to employment—it’s also responsible for deepening the wage gap.
But in recent years, there’s been an ideological shift. Employers are beginning to recognize that a bachelor’s degree is not the only indicator of future success for candidates. They’re beginning to reconsider how they evaluate candidates, replacing degree requirements with skills-based hiring strategies.
Skills-Based versus Degree Requirements
Skills-based hiring counteracts the paper ceiling. It’s a hiring approach that prioritizes relevant experience and proven skill sets over degree attainment. Through this method, employers primarily use skill-level to measure the qualification and potential success of an individual.
Not only does it assign a higher value to skills, it eliminates the requirement for a degree at all. And doing so broadens the list of qualified candidates, creating a larger and more diverse talent pool.
It is important to note though, that degrees are not entirely disregarded in skills-based hiring. They are just no longer necessary for consideration and are not considered the primary indicator of success in that role.
Think about it like this:
Two people apply for the same role in IT. Candidate A has four years of experience and several certifications, whereas Candidate B has a bachelor’s degree in computer science and only one year of experience. In skills-based hiring the degree is a plus, but it might not outweigh having more years of experience.
What are the Benefits of Skills-Based Hiring?
The truth is that skills-based hiring can benefit your teams in a lot of ways! It’s an innovative, progressive approach that combats traditional, potentially limiting requirements. It also increases experience and skill level throughout your organization. Put simply, it’s better for business and for people.
Let’s breakdown four key benefits of skills-based hiring:
Higher education can be inaccessible for several reasons, but high cost of tuition is the most frequently cited obstacle. The average cost of tuition at a 4-year, in-state institution is more than $25,000 per year—or more than $100,000 total. Removing degree requirements creates a more equitable process for those who cannot afford traditional schooling, but have certifications and training through other affordable avenues.
By creating a more equitable process, you’re also taking a step toward building more diverse teams. Skills-based hiring will allow you to bring on talent from a wider variety of backgrounds.
Expanded Talent Pool + More Qualified Candidates:
When you use degree attainment to frame your talent pool, you’re limiting your options. Lack of a degree does not indicate a lack of experience or in-demand skill sets that would benefit your team. In fact, it can sometimes mean the opposite. Many professionals use the time they would have spent in college to gain real-world experience. By using a skills-based approach you can expand your talent pool while also opening the door to more qualified, experienced candidates.
Candidates hired based off their skills are more likely to enter their position with more experience and prior training. That means saving time and money during the initial onboarding, training, and/or ramp-up period.
Implementing a Skills-Based Strategy
Breaking with traditional hiring practices can be intimidating, but implementing a skills-based approach is worth it. Here are three tips to start reframing your hiring strategy so you can hire skills, not just degrees.
Remove Degree Requirements:
The first step is the most obvious—take degree requirements out of job listings where specialized education is unnecessary. Take the role of software developer for example. Tech is a space where there are so many options to learn occupational skills outside of a classroom. Many software developers are self-taught and/or gained expertise through online certifications. For roles like this, it’s not necessary to have a bachelor’s degree.
Write the Job Description Based on Skills:
When writing a job description you should imagine the perfect candidate. What are their strengths? What hard or soft skills would they ideally have? Are there any processes they would already know? Fill the requirements section with a list of skills or experience you’re looking for and use that to gauge the qualification of a candidate.
Company Culture and Leadership Buy-In:
For skills-based hiring to succeed, you need existing teams to embrace the new process. Explain the reasons for this change in direction and demonstrate the value it has for business and for people. This is especially important for your leaders, as their buy-in will only enhance your new hiring strategy.
But you don’t have to stop with the hiring process—you can build skill development into your culture, too! A great way to achieve this is by creating an environment that encourages continued learning, whether it’s for existing career paths or new ones. Find ways to up-skill or even re-skill existing employees, so they’re continually expanding and strengthening their skill sets.
Build Teams Using Skills, Not Just Degrees
For experienced, competent, and motivated teams, it may be beneficial to remove degree requirements and switch to skills-based hiring. And if you’re unsure how to do that, we can help! We can match you with qualified and pre-vetted candidates with all the skills you’re looking for within just two weeks.
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