Why HR leaders need skills-based hiring now

A college degree used to be the golden ticket to kickstart a professional career. A stamp of approval from higher education on your resume was the fastest on-ramp to a comfortable, salaried position with benefits. While the positive correlation between a college education and long-term income potential has been consistent, the rapid increases in tuition and growing constraints on financial aid programs have made a college degree an unattainable goal for many otherwise qualified individuals.

Unfortunately, HR departments have been slow to adapt their hiring practices, and many recruiters still limit the review of potential candidates to include only those with a relevant degree, a shortsighted view. From my perspective, looking only at the college degree penalizes both qualified potential applicants as well as the companies looking to fill positions. As a result, employers need to adapt quickly and view non-degree skills-based hiring as a new approach to sourcing and acquiring talent.

Major companies driving trend in non-degree, skills-based hiring

Requiring a degree is hurting both employers and the growing pool of non-degree, skilled candidates that exists. NPR cites that as many as 40% of people who began at four-year institutions in 2012 finished their degree six years later, perhaps due to financial hardship or extenuating circumstances. How do these candidates get credit for the skills they’ve acquired without a degree? HR departments need to adapt their hiring practices and view candidates as an aggregate of qualifying factors.

Luckily, a few industry leaders are beginning to widen their aperture and pave the way for a massive shift toward skills-based hiring. Apple has stated that as many as half of Apple employees did not hold four-year degrees. More controversially, Siemens CEO Barbara Humpton, and Tesla CEO Elon Musk both have been on record questioning the value of a four-year degree and are proponents of hiring employees without college degrees.

Aside from the debate about the value of a college degree, the fact remains that the college degree is—at best—a blunt indicator of suitability for many jobs. Apple CEO Tim Cook has compared the skills coming out of colleges with what he believes are the skills of the future. Guess what? They do not always line up. If learning new skills in such emergent areas as AI, big data and machine learning will be necessary to effectively staff tech jobs in the future, then companies need a process in place to evaluate potential candidates based on whether they have completed relevant courses related to them, with or without a degree.

Unemployment surge forcing many to acquire new skills

This situation is further compounded by the COVID-19 pandemic driving record unemployment in most major industries. For the lucky ones, their job loss may be temporary as furloughed employees can and will eventually return to previous roles. But many others may need to pivot to a new, more necessary role or consider acquiring new skills to apply for and secure an entirely new position. If this happens—and it’s highly likely that it will—this talent pool will need to acquire new skills via classes or certifications.

For example, as efforts to contain the COVID-19 pandemic continue, a new in-demand career is fast emerging: tracers. Tracers will be on the frontlines of finding infected individuals and identifying to whom they could have spread the virus. Illinois reportedly is looking to hire thousands of employees for its tracer program. It is a huge undertaking and a prime example of both the talent pool and a new employer needing to pivot their hiring practices to scale to the current demand. But how will these organizations appropriately and efficiently vet applicants? How will companies credit achievements of non-degree holding, yet skilled talent that want to secure these jobs?

Where technology can fill a need

Not surprisingly, HR systems are not currently set up for this level of skill-based evaluation.

For example, one of the primary entities maintaining education data—the National Student Clearinghouse—keeps only enrollment and degree information. There are no mechanisms for organizations to easily access and process more detailed academic data, such as what classes students completed throughout their college experience; finished or not. This is where innovation in technology is vital. Creating a product that can thoroughly vet student transcript information would fill that important gap and accelerate the process of matching these non-degree skilled workers with the companies pining for new talent.

It is evident that a widening talent gap needs to be filled. HR departments can no longer succeed by relying solely on the college diploma as their main filter for candidates. With the rise of large, scalable jobs such as the COVID-19 tracer program shows, there needs to be a streamlined way to match non-degree skilled talent to employers.