Why Skills-Based Hiring is Here to Stay

Skills-based hiring is coming to the fore. Harvard Business School analysts suggest that "only 27% of the pivot to skills-based approaches in the hiring processes are "cyclical resets" or short-term responses to the recruitment crisis, while the majority (63%) are "structural resets."

In fact, hiring based on skills is five times more predictive of future performance than hiring by education. And by removing minimum degree requirements from appropriate positions, recruiters can unlock new swathes of eligible candidates. But how exactly can skills-based hiring help recruiters measure a candidate's performance abilities?

How to hire based on skills

As mentioned, removing the college degree as a minimum requirement means millions of additional applicants will be eligible to apply. Recruiters can instead focus on soft skills such as communication, interpersonal relationships, and a positive work attitude as these are fundamental to positions in sales and marketing, administration, and service teams. When reviewing resumes, they can also identify relevant experiences such as "developed," "solved," "fixed," "analyzed," and "improved" to better understand their intellectual abilities.

Skills-based hiring can also support recruitment for more technical positions. Degree requirements are already being removed from advanced tech roles to reverse degree inflation. With 29% of its postings for IT roles requiring a degree, IBM has excelled beyond its peers in stripping degree requirements from job postings. Equivalent numbers for Oracle, Intel, and Apple, by comparison, stand at 100%, 94%, and 90%, respectively. Companies like IBM focus on "hard skills" in recruiting, i.e., pre-employment testing, certifications, and work history.

Driving a more inclusive future in tech recruitment

Skills-based hiring addresses inequity and restores candidacy to the 66% of Americans who do not have bachelor’s degrees, including more than 75% of Black people and more than 80% of Latinx.

STARs – people skilled through alternative routes – represent a 70+ million-strong talent pool. Giving STARs access to new job opportunities through skill-set recruitment not only opens up a whole new world of work to many Americans but also means employers have access to a whole new pool of talent.

Tech companies like Amazon and Boeing, for example, successfully use boot camps and coding schools to find entry-level employees with good basic skills. Since the proportion of minority boot camp graduates is higher than their proportion in the overall U.S. tech industry, hiring candidates from these programs will enhance the diversity of skills and talents within your company.

Looking ahead, performance and intellectual capacity should become the driving success factors for people’s career progression. And, even though other barriers may remain, more diverse talent coming in at entry-level could be a driving force against the persistent glass ceiling and inequality.

“We don’t care if you have a degree. We just care if you can code” may well prevail as the new mantra for Silicon Valley.

The SHRM Blog does not accept solicitation for guest posts.

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