With historic low unemployment, a need for candidates with evolving skills is driving a national movement.
Skilled Through Alternative Routes, or STARs, refers to the estimated 70 million workers ages 25 and older who are active members of the workforce and have a high school diploma but no bachelor’s degree. Instead, they have gained valuable on-the-job experience through the military, community college or other alternative jobs.
Could this be the workforce of the future?
Skills-Based Hiring in Theory
In my role as a practice leader of a global recruiting firm, I am seeing increasing numbers of employers, overwhelmed by prolonged job openings and too few applicants meeting rigid requirements, embracing a more holistic approach to hiring—one that considers education, skills, experience and, perhaps most of all, potential.
A decade ago, there was no need for this kind of thinking because employers had their pick of degreed applicants with a few years of experience and perhaps a certificate. Today, the supply is low, and for all industries—from semiconductors and renewable energy to health care and construction— hiring is at crisis proportions.
Wise hiring leaders are embracing skills-based hiring, which screens candidates for specific competencies, including knowledge of multiple coding languages, over educational background.
A lot can be accomplished when hiring leaders and their recruiting partners think outside the box and are empowered to create a recruitment strategy that employs basic skills-assessment tools and behavior-based interviews to find great people.
Skills-Based Hiring in Action
At Duffy Group, we recently helped a nonprofit fill an opening for a director of development. The budget for the position was small, and a seasoned individual was out of reach. The organization agreed to rethink its job description, listing other desirable skills that might be found in a junior-level person. With qualities like being a self-starter, a great communicator and a ready collaborator, and having an outgoing personality and a passion for the mission, the nonprofit was able to find candidates who could grow into the job.
Another nonprofit client launching a CEO search reconsidered the job requirements and attracted a candidate who had served on several nonprofit boards but had never been a CEO and came from a different industry. She was hired and has since propelled the organization to a higher level.
And In health care, we are recruiting to fill positions that have never before needed that attention — nurses and caregivers. For some of these jobs, employers are accepting as a primary qualification a clean background check, then committing to pay for education and certifications once hired.
For most Fortune 500 companies, which today must monitor their carbon footprints and address their output more sustainably, there aren’t enough degreed experts in the relatively new field of sustainability to go around. Getting ahead of the game means building basic-skills lists and hiring individuals with the commitment to send them for the specific training required.
As part of the CHIPS and Science Act, Intel and Taiwan Semiconductor Manufacturing Co. (TSMC) partnered with 10 Arizona community colleges to train students for jobs in the chip industry. The Maricopa County Community College District pays tuition for the students who finish the Arizona Semiconductor Technician Quick Start Program with the necessary skills to support the production of semiconductors and related technologies.
Skills-Based Hiring Benefits and Challenges
A recent report by TestGorilla found 73% of employers used skills-based hiring in 2023, up from 56% in 2022. Those employers reported an 88% reduction in mis-hires, along with these impressive stats: Total time required to hire dropped 82%, hiring costs fell 74%, and employee retention rose 89%.
Advancing the principles of diversity, equity and inclusion is another benefit of skills-based hiring. For example, an individual who uses a wheelchair due to a disability can qualify for a position for which the basic skills were modified and be a productive member of society.
Goldman Sachs launched an online “skillset” platform on which candidates apply for specific skill areas rather than jobs. They participate in skill testing and are then referred to the most relevant jobs.
Walmart helps its associates to advance in the company with skills-based, short-form certification programs. Employees learn data analytics, cybersecurity, and supply chain management, among other skills, and can use those credentials instead of degrees.
Introducing this new perspective isn’t a one-and-done process. Rather, a successful skills-based hiring program requires employers to challenge their hires to acquire new and evolving skills, to upskill and re-skill over and over again. It’s work, but when done correctly, it can help organizations widen their candidate pools, fill open positions and continue to grow.
Kristin Pozen is a practice leader and senior executive recruiter at Duffy Group, a global recruitment firm based in Phoenix.
The post <strong>Credentials vs. Chops: Skills-Based Hiring is Here to Stay</strong> appeared first on HR Daily Advisor.