Many companies are moving away from degree requirements in favor of skills-based hiring

Many companies are moving away from degree requirements in favor of skills-based hiring Verbalists Education Beyond Borders Podcast

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03-AUG-2022 | New research on United States labor market trends points to some important shifts in the skills required by employers across the economy. In place of four-year-degrees many companies are instead focusing on skills-based hiring to widen the talent pool.

A US-based research center, The Burning Glass Institute, has produced two reports this year on the subject “the future of work and of workers.” Both reports point to an important reset in the labor market with respect to degree requirements. It should be said that the two studies are concerned specifically with labor demand in the United States, but each relies on large-scale analysis of millions of job postings and they echo trends that can also be seen in other developed economies.

Overall, the findings point to an increasing emphasis on the use of technology, even in fields that are not technology focused. In addition, employers are now trying to find out if candidates have key interpersonal and communication skills, including problem solving, teamwork, collaboration, and creativity.

Skills-based hiring
Employers are resetting degree requirements in a wide range of roles, dropping the requirement for a bachelor’s degree in many middle-skill and even some higher-skill roles

Connected to this changing skills landscape is another key trend identified earlier this year by another large-scale analysis of United States employment postings: many employers are dropping degree requirements, and especially so over the last two years. Employers are resetting degree requirements in a wide range of roles, dropping the requirement for a bachelor’s degree in many middle-skill and even some higher-skill roles. And while the COVID-19 pandemic accelerated this process, this reset began before the crisis and is likely to continue after it.

Aside from those two important shifts – the changing skills landscape and the easing of degree requirements – the overall picture you get from the two reports is of a greater emphasis in the US on skills-based hiring. There is a greater weight given to the skills that candidates have as opposed to their academic qualifications. This has been driven in part by an underlying labor market dynamic. In short, there is not enough labor or talent to meet employer demand and so employers are responding in part by easing hiring requirements. But it also reflects the fast-paced nature of technological change across the economy.

There are important market signals in these findings for candidates, employers, and educators alike. For example, students may be more encouraged to explore non-degree post-secondary options. And educators may be just as encouraged to give a greater weight to the development of so-called “soft skills” in their curricula, especially with respect to communication, creativity, collaboration, and problem solving.


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