Skills-based hiring trends and challenges ahead
The adoption of skills-based hiring has been on the rise, as indicated by a recent report from LinkedIn. In 2022, 29% of paid job postings on the platform did not require professional degrees, compared to 21% in 2019. However, this shift has not necessarily translated into increased hiring of non-degree holders.
LinkedIn users, especially those using the paid Recruiter feature, have prioritised skills-based searches over degree-based ones. This change in user behaviour suggests a growing emphasis on skills when seeking candidates. However, the crucial question remains: Does eliminating degree requirements lead to more hires of individuals without degrees?
According to Greg Lewis, a senior content marketing manager at LinkedIn, the answer varies across industries and functions. While many industries have embraced the concept of skills-first hiring in their job postings, the actual hiring practices often lag behind.
In some sectors, job postings that do not require degrees are growing at a significantly faster rate than those that do. Notably, financial services, accommodation and food services, and technology, information, and media are among the sectors experiencing substantial growth in degreeless job postings.
Certain job functions also exhibit accelerated growth in degreeless job postings, with accounting leading the way. However, when it comes to actual hiring, the results are mixed. Degreeless hiring is increasing, but the rate of hires without degrees frequently falls short of the rate indicated in job postings.
In industries like accommodation and food services, there has been an 11% faster growth in hiring individuals without professional degrees compared to those with degrees. A similar trend is observed in financial services with 6% faster growth and in technology, information, and media with 3% faster growth.
Despite these variations, some industries, such as consumer services, entertainment, and government administration, are actively hiring more workers without degrees. Roles like project managers and administrative assistants are among the top positions filled by hires without degrees in these industries.
Across various job functions, there have been modest increases in the hiring of individuals without degrees, particularly in community and social services, media and communication, and legal specialties like paralegals.
However, Greg Lewis notes that the shift in hiring practices is less dramatic than the change in job postings. This suggests that while recruiters are increasingly searching for candidates based on skills rather than degrees, traditional degree requirements still heavily influence hiring decisions made by managers.
To bridge this gap, Lewis emphasises the need for recruiters to collaborate with hiring managers as strategic advisors to bring about real changes in hiring practices. He underscores that meaningful change requires time and effort, and merely talking about skills-based hiring is just the initial step.
Lewis also highlights the importance of including relevant skills in job postings on LinkedIn. Such postings tend to attract more applicants and enjoy higher conversion rates. Candidates can envision themselves in these roles, even if they lack exact previous experience.
Furthermore, organisations that adopt skills-based practices and hiring methods tend to outperform their peers, according to a Deloitte report. However, many companies struggle to implement significant changes, particularly in response to the growing demand for workplace agility.
To address this challenge, companies can focus on in-house training, apprenticeships, and other nontraditional approaches to build their talent pipelines and meet the evolving needs of the workforce.