According to recent reports, many companies are focusing on skills-based hiring when looking for applicants!
Recent reports and data reveal that many companies are now focusing on skills-based hiring rather than traditional metrics like education or years of experience. In the past two years through April 2024, the percentage of U.S. online job postings that require a specific employment tenure has decreased by 10%, dropping to 30%, according to Indeed. Furthermore, 52% of job ads now do not require formal education, up from 48% in 2019. The data shows that mentions of college degrees have decreased in 87% of occupational groups over this period.
“We definitely see a change in the way the interview and hiring process works”, said Cory Stahle, an economist at the job site Indeed.
A survey of 2,000 employers, done by ZipRecruiter, also highlights this shift towards skills-based hiring, which focuses on applicants’ competencies. 45% of employers have removed degree requirements for some roles in the past year, and 72% now prioritize skills over certificates when evaluating job candidates. This trend of focusing on practical skills and real-world experience is “gaining momentum”, according to ZipRecruiter.
Skills-Based Hiring Surge
After the U.S. economy reopened in 2021, the surge in demand for workers led businesses to drop college degree requirements, a filter that excludes about 62% of Americans who lack a degree, according to a joint study by Harvard Business School and the Burning Glass Institute. This shift also aims to enhance workplace equity, as over 70% of Black, Hispanic, and rural workers don’t have four-year degrees, which often causes their skills to be overlooked.
While traditional qualifications like education remain crucial for certain professions, many employers are realizing these aren’t always the best indicators of job suitability and, in addition to that, job seekers benefit from new career opportunities that were previously inaccessible, Stahle pointed out. According to the Harvard-Burning Glass study, skills-based hiring results in measurable benefits such as higher retention rates among workers without college degrees and significant salary increases for these candidates.
However, some firms struggle to implement this change effectively. About 45% of companies “seem to make a change in name only, with no meaningful difference in actual hiring behavior following their removal of stated requirements from their postings”, as per the Harvard-Burning Glass report.
Implications for Job Seekers
Job seekers should focus on showcasing their skills in their resumes if job ads emphasize it. While skills should be highlighted, traditional information like work history and education should still be included, as hiring managers might still value these qualifications, Stahle suggested.
Additionally, candidates should be prepared for potential skills tests during the hiring process, though the specifics can vary by company. Developing and demonstrating the required skills are essential for job seekers in this evolving hiring landscape, he added.