February 12, 2025 • 26 mins
Could shifting your focus from degrees to skills revolutionize your hiring process and boost your business's success? Join us for an eye-opening discussion with our HR expert, Greg, who unveils how modern hiring practices are evolving to meet industry demands. We promise you'll learn how to attract top talent by crafting clear job descriptions, minimizing biases through anonymized resumes, and empowering diverse interview panels. Discover the transformative potential of skills-based hiring and why it's becoming essential in today's technology-driven world.
Our episode sheds light on real-world examples, from Goldman Sachs to military recruitment strategies, demonstrating the power of skills over traditional credentials. Greg shares invaluable insights on fostering an inclusive company culture that not only welcomes nontraditional candidates but also encourages career progression based on competencies. We discuss the importance of ongoing training for hiring managers to identify and neutralize unconscious bias. By embracing this approach, you can unlock a talent-sharing culture, promoting growth for both employees and the organization. Get ready to rethink your recruitment strategies and harness the critical role of skills in shaping the future of work.
Presented by John Wandolowski and Greg Powell
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 2 (00:21):
I'm your host, john Wendolowski, and I'm here with
my co-host and friend, gregPowell.
Hey, everybody, yeah, and todaywe're going to talk about a
subject that I think is veryimportant, especially right now,
in terms of a subject that Ithink has a lot of conversations
(00:43):
about.
I believe that the hiringprocess is a very important
process to talk about and maybegive it a little bit more of a
definition.
When I think about the subjectand I know a little bit of the
background of the hiring process, there's so much to it that
really doesn't meet the eye, andwhen people talk about whether
(01:03):
they're doing a good job hiringpeople, I'm going to push back
and say prove it, because I'veseen more people doing it wrong
and people that I've hadreporting to me doing it wrong,
and one of the things that I'vehad to work on to make sure that
they were doing it right.
The best example I can give isI'm an engineer and I did a lot
(01:24):
of construction work and it wasalways interesting to hear how
you're doing.
A gold standard or a silverstandard or a platinum level,
kind of environmental, epa, kindof building, and these ratings
are very important in terms ofthe quality of construction and
(01:44):
the organizations that I wasworking for wouldn't pay for
these additional awards, but wewould go over and say that we
were capable of either hitting abronze or a silver or a gold.
Most of the work that I wasinvolved with was either gold or
platinum, because we weredealing with the right materials
, the right supplies, the rightkind of engineering approach in
(02:06):
terms of success, in terms ofresults that you're expecting
from heating systems and coolingsystems.
It's doing it right the firsttime.
Very basic.
It is not exclusive to justengineering.
It does mean the same thing ina hiring process.
It does mean the same thing inthe hiring process Understand
what's involved in terms of whatit means to hire.
(02:27):
To be in my world, to beinclusive, is to be accurate and
to be complete and to give agood picture of what you're
looking for for a new candidate,a new employee.
I'm going to actually hand thisover to our HR professional.
(02:48):
Greg, with the experience thatyou've had in this field, why
don't you kind of warm up thesubject of what it means to hire
the right way?
Speaker 1 (02:55):
Thanks, john.
So introduction to this topicwould be something like this A
key challenge for companiestoday is the battle for
attracting and retaining toptalent.
You got to get engaged in thatbattle.
You got to do it well.
The right talent drives thebest results of those best
business results.
So the challenge cascades downto a responsibility for hiring
(03:16):
managers to find this talent.
They've got HR support andthey've also developed an
interview team that's helpingthem source and appraise the
best candidates possible.
But to achieve a successfuloutcome requires much more than
simply posting a generic jobopportunity on a random job
board.
So let's talk about some keyconsiderations.
Create clear job descriptionsthat emphasize skills,
(03:39):
experience and competencies thatare really needed for the job.
Consider removing identifyinginformation from resumes and
applications that might cause alittle bit of bias to come out.
Develop standardized interviewquestions, including behavioral
interview questions, for allcandidates so that you minimize
those unconscious biassituations.
Assemble interview panels withindividuals from different
(04:03):
departments and differentbackgrounds to leverage diverse
perspectives.
Use structured assessmentmethods like skills tests or job
simulations to objectivelymeasure candidates' abilities.
Company's mission, values,vision, culture includes things
(04:28):
like their attitude towardscollaboration, innovation and
inclusivity.
Provide ongoing training forhiring managers and interviews
on recognizing and mitigatingthe problem of unconscious bias.
Conduct regular skills tests onthe hiring process and expand
your reach past a wider net andwe'll get into that a little bit
more as we go along here andfinally, summarize the
(04:49):
recruiting strategies to createan inclusive hiring process that
focuses on candidates,qualifications and potential.
John.
Speaker 2 (04:59):
And Greg.
Those are the points that Ireally wanted to try to
emphasize during this podcast.
There's so much more to hiring,but you can do it right and you
can do it wrong.
The examples that I've foundthat have been interesting is
understanding your culture,understand the department and
(05:19):
the organization that you'reworking with.
Can you describe the culturethat you're working in
organization that you're workingwith?
Can you describe the culturethat you're working in?
Can you describe the culture ofthe person that you're looking
for and how they would fit thatculture?
More importantly for me isskills.
Now I found a very interestingarticle called Competency Over
Credentials the Rise ofSkill-Based Hiring from the
(05:41):
Boston Consulting Group, andthey had this great article on
the rise in skills of basedhiring from December 11th 2023,
which I think is important.
So, in terms of the authors,I'm just going to say you should
look it up there.
It's a great group, but there'salso hard names for me to
(06:01):
pronounce, so I'm going to moveon and talk about their article.
I found their first sentenceprobably the most interesting.
It's been the call of the deathof the degree, and static
college degrees seem to be lessrelevant with the rapid change
in technology.
Employees are now asked to havemore dynamic, involved skills
(06:27):
and to up those skills again andagain, because the industry is
changing all the time.
People looking for employmentagree with their 2022 BCG survey
that many of the job seekerswish that they could look for
more skill and experienceinstead of degrees and
certificates, and now many ofthe companies are doing just
(06:47):
that, but how much and howsuccessful.
To be a little bit more precise, they went through and BCG
worked with Lightcast and theyfound a way of doing a big data
research of over 20 million jobpostings, and I think that's the
important point of this article.
This is a pretty broad strokeof the brush to see what it
(07:12):
means in terms of a degree andskills they go on and talk about
.
As noted that technology is thedriving constant and the need
for new skills, especially inthe advent of AI and generative
AI, but according to Pearson'sBusiness School Research, only
13% of the college graduateshave the skills needed to start
(07:35):
a job right away.
Furthermore, 54% of collegegraduates don't work in the
original field of study.
You put a point on that.
The jobs that will be availablein five or ten years may not
even exist today.
For all of these reasons, thevalue of a traditional degree
has become a question mark.
At the same time, organizationsare struggling to find talent
(07:59):
that they need.
Unemployment remains remarkablylow for a workforce that is
aging, and open positions remainunfilled.
Moreover, employees that expectto have the opportunity to
evolve workers increase theirmobility and they also are
looking for flexibility.
They are also on hold for thepower of the market to see where
(08:24):
the greatest competition is atand where talent is being
actually pulled.
Meanwhile, candidates areself-taught who are gaining
their skills and theirexperience and becoming the
major workforce in the labormarket.
In the US alone, 70 millionpeople can be categorized as
STARS, which is workers withoutbachelor's degrees that are
(08:47):
skilled through alternate routes.
Stars, the ensuing tug of warbetween skilled individuals and
organizations must rethink theirapproach to recruitment.
They must widen theirrecruitment lens to capture the
diversity of skills and theirexperience of changing
(09:09):
workforces.
They need to shift from thedegree to the pedigree, the will
and the skill To embrace theskill-based hiring.
They have to tear down thepaper ceiling that keeps
individuals without a degreefrom entering certain
occupations and advancing towhere they can be productive.
(09:34):
Educational credentials are notonly indicators of success.
We also advance to approach andhire on skills, experience and
potential.
Now they did talk about thepaper ceiling and how it doesn't
erode across all marketplaces.
(09:55):
In the United States you seealmost a 4% drop in degree-based
requirements, where Canada seesa little bit of an increase.
The UK and Australia areshowing both like 1.8, 1.6 kind
of drop.
Singapore, on the other hand,has asked for more degree type
(10:17):
individuals by the tune of likefive, five and a half percent.
So a paper ceiling, I think, isthe piece that I want to
challenge.
But I also want to bring up thepoint that this article is
talking about skills and culturejust as much as paper, and
that's really the theme of ourpodcast today.
Greg, maybe you can add to thatconcept a little bit.
Speaker 1 (10:41):
Yeah, thanks, john.
There is definitely a paradigmshift from having degrees and
focusing on degrees to learningabout importance and the need
for skills.
The US leads a shift toskills-based hiring across
career areas.
Many large employers with asizable US labor force are
embracing the trend Companieslike Dell, accenture, ibm.
(11:03):
Us government is too.
In fact, back in January of2021, the White House announced
limits on the use of educationalrequirements when hiring for IT
positions, lookingpredominantly at college degrees
.
It said let's be careful not toexclude capable candidates and
make sure that we're notundermining the labor market
efficiencies.
So degree-based hiring isessentially likely to exclude
(11:25):
qualified candidates for jobsAgain, folks that have the
ability and capability andskills to do the job.
You don't want to eliminatethem.
In Canada, uk, australia andSingapore, there's a lesser
shift and a different mix ofcareer areas affected, and
there's a chart that talks alittle bit about that.
I'm going to ask John toexpound on that a little bit.
(11:47):
Yeah.
Speaker 2 (11:50):
What they were doing.
The original graph that theywere showing was the United
States showing a three I'm sorry, 4% kind of drop and at the end
of the day, they had all thesedifferent trades that they were
talking about Agriculture,business, communication, finance
, healthcare, transportation,you name it.
(12:12):
In the States, across the board, they can see a decrease in
terms of people looking fordegrees, and it's not by 1% or
2%, it's like 18% in agriculture, 6% in clerical and
administrative positions, 10% inconstruction.
So people are starting tounderstand that in a tighter
(12:35):
working pool that talent is outthere.
They may not have a degree, butthey can show the capacity of
doing it.
Speaker 1 (12:45):
Greg, engineering is the only field where the paper
ceiling remains in place, andJohn and I talked about that a
little bit.
I was hearkening back to myprevious role in HR for a
company that used a lot ofelectrical engineers and power
systems engineers, and John'sown experience in education
would support this as well.
So employers in four out offive countries have increased
(13:08):
the demand for degrees in thisfield engineering.
This may have to do with safetyconcerns, regulations affecting
such roles, as well as thehighly specialized nature of
engineering jobs.
Shorter courses and on-the-joblearning may not easily replace
the competency needed to getthose degrees.
Speaker 2 (13:27):
Yeah, and what was interesting is that while you're
looking at hiring and you'relooking for whether skills make
sense, there's a wonderfularticle that I came across and
it's a message from the AmericanPsychological Association that
(13:47):
they delivered years ago thatstill stands true today To hire
on skill versus one that's oneducation.
You are five times more likelyto predict job performance.
For their analysis, they lookedat the promotion rate and the
tenure for these companies,using US as an example only,
(14:08):
because basically the UnitedStates was the pioneer in
skill-based hiring.
The promotion rate generallythose hired based on their
skills get promoted at a ratecomparable to traditional hires
and they will only see 2% lesslikely on the average to be
promoted in the same period oftime.
This suggests that skill-basedhires perform at the same level,
(14:35):
similar to their peers who havedegrees, and they are first
ones to be able to actually seethe opportunity for promotions
because of their experience andhow they actually work within
the organization.
Skill-based hires for thingslike community social services,
(14:56):
hospitals, healthcare, education, customer service kind of
positions all those show a realtrend to skill-based hires
rather than degree-type hires,and I think the challenge for
anyone that's trying to hireright now is to be able to make
(15:16):
the distinction between what isa skill-based hire versus a
degree Degree is kind of asafety net For me.
The article is talking abouthow these degrees sometimes have
no relevance to what theindustry is doing currently.
For me, I always consideredsomeone with a degree as the
capacity to show that they'rewilling to learn.
You gain that same kind ofmentality if the person has
(15:39):
built their skills in the samekind of methodical approach
basic to advanced to be able toshow and demonstrate those kinds
of skill sets.
The other interesting technicalpart of hiring by skill is the
type of people that you'rehiring are going to stay with
(16:00):
the organization.
They tend to stay for a longerperiod of time an average of 9%
longer than other skilled tradehires.
And that trend is true in mostindustries and professions
because it is pronounced in thetrades and the transportation
and food industries, as well asin the public administration,
(16:26):
the information, thecommunication technology,
professional services.
They all stay longer.
Their experts underscore thetrend of skill-based hires, have
better problem-solving skillsand, in general, have more
interest in exploring the firm,the company that they're working
for.
So their experts found thatthere was a trend that
(16:47):
skill-based hires have hadbetter problem solving skills
and were more interested in theorganizations that they were
working for.
That kind of approachdemonstrate their high
engagement and their motivation.
That's really what you'relooking for when you're hiring
someone.
Those are the ones, those arethe skills that you're looking
for.
More so, the character, theculture those are the key words
(17:10):
that you should be looking atwhen you're hiring.
Greg.
Why don't you roll this into alittle bit of a better
description?
Speaker 1 (17:16):
Thanks, john.
How can organizations succeedwith skills-based hiring?
So the first thing is challengethe biases in your talent
strategy today.
Be more open-minded.
Is a degree really required fora specific job?
We've got data that indicatesthat the paper ceiling is
vanishing even in jobs thattraditionally call for a degree.
(17:38):
Goldman Sachs recently shiftedto what is called a skill set
recruiting approach Through thecompany's new online platform.
Candidates don't apply for jobs.
They apply to specific skillareas, then participate in skill
testing and get referred forthe most relevant jobs based on
their skill sets.
Know the skills you need.
We've got research that saysthat skills-based job ads
(18:00):
include a higher number ofskills than traditional job ads.
Traditional data scientist jobads, for example, list
approximately 28 needed skills,whereas skills-based ads for the
same role will list as many as37 skills needed.
So skill-based ads especiallyover-indexed on transferable
skills such as collaboration,communication, which can be a
(18:23):
foundation for success in anyjob.
Up your skill assessment game.
The big risk when hiring peoplebased on skills rather than a
degree especially a degree froma tried and true institution is
the lack of proxy proof ofcandidates' qualifications.
So instead, employers have toobtain that proof by assessing
(18:44):
and testing candidate skills,which they often are prepared to
do or don't know how to do itefficiently.
They can look at other proxieslike micro-credentials, learning
badges from short often digitalcourses.
I think you get the picture.
They could also test candidatesby asking them to demonstrate
skills like writing code,participating in a trial period,
(19:06):
things like that A supportiveand inclusive culture.
Sometimes the main barrier toskills-based hiring is cultural
Managers want to hire people whowent to the same schools they
went to.
Recruiters don't want to take arisk on people from
nontraditional backgrounds.
Many company leaders followtraditional routes and expect
(19:27):
their successors to do the same.
In such an environment,skills-based hires may feel
discriminated against or simplyjust not welcome.
So, john, we talk about castinga wider net, and so I'm not
going to pick on any schools inparticular, but if you always
went to such and such state orsuch and such university because
they're top notch in winningawards and notoriety and maybe
(19:52):
teaching a discipline that youneed, you forgot that there are
other schools that are also verygood.
They might be smaller, have notthe notoriety, but offer the
same kind of training.
No-transcript.
Speaker 2 (20:12):
And we talked about this in one of the other like
casting a wider net.
I had technical positions,military people across the board
who have gone from an entrylevel and shown progression
through their technicalpositions to a higher ranking,
demonstrated the skill sets anddo a very good job of
(20:35):
understanding what shift workmeans, working in order to get
results.
They're motivated, they'rewonderful employees and that
broader net, that whole idea oflooking for better examples of
what we're looking for for anemployee and culture fit in very
well in what a lot of militarypeople that I hired and culture
(20:57):
fit in very well in what a lotof military people that I hired.
Speaker 1 (21:01):
So yeah, Greg.
So, John, let me build on that.
I worked for a gentleman whowas a former general in the Army
, ran logistics for a very bigretailer, and we found out that
folks that had worked in themilitary liked working in
logistics centers.
They didn't mind shift work,they understood the importance
of product not moving it toomuch, knowing where you put
(21:22):
things, discipline, safety thatwas their life, and we started
creating a channel of recruitingopportunity there.
And my last company,engineering company we found
some folks in the Navy that didexactly what we do, and if we
didn't seek out folks from theNavy, we've missed an incredible
opportunity for some talent.
And so, again, casting thatwider net is going to be
(21:44):
non-traditional places to getreally qualified folks, and some
may have degrees, some may not,Some may have certifications
that they've earned in themilitary net and proven they can
do the job right.
So so that's what we're talkingabout when we talk about
casting a letter net.
So then let's keep thinkingabout skill base.
It's not just about hiring.
(22:04):
After they brought skills-basedhires into their teams,
employers should continue tosupport those employees through
career progression.
So promotion should be based onskills and should other
internal moves and talentdecisions.
So the reason you brought themup to the company?
Because their skills shouldhelp them stay with the company
and progress throughout yourorganization.
So several talent marketplacetools help facilitate this.
(22:27):
However, a move like thisrequires a significant mindset
shift in the organization fromtalent hoarding to talent
sharing, from talent hoarding totalent sharing.
So managers as well as the HRfunction need to get more
comfortable with enablingskills-based, flexible career
paths.
So just because you broughtthis person in and you took that
risk they're doing a good jobfor you doesn't mean they're
going to stay in your particularpart of the organization.
(22:47):
They may stay with the company,but be willing to give up that
asset.
John.
Speaker 2 (22:52):
And that's career development.
If you're doing something forthe employee and that you're
going to really appreciate, it'snot holding them back from
going laterally and having anopportunity to grow.
If you're doing your job rightas a leader, you're trying to
encourage other departments.
If they see that opportunityfor advancement, they deserve it
and that's one of the positivethings is that you're hiring
(23:15):
good people that can work in theorganization in other locations
.
I'll tell you right now that'sgoing to help your career as
much as it's going to help theircareer.
So let's try to wrap this upand try to give you a little bit
of an idea of what we're tryingto talk about here.
Skills are really as importantas having a degree.
(23:37):
Understanding what is a cultureof your environment, of your
workforce, of your workapplication is just as important
as doing a good job of puttingin an ad and having the right
words on what you're looking forfor an employee, because you're
spending a little bit more timedetailing what you're looking
for and hopefully people can seethat connection.
(23:59):
And probably the most importantthing is throwing that wider
net being open to differentpeople and different
opportunities.
Is that inclusive?
You bet it is, but that isn'tthat it's a bad idea.
It is actually beingprofessional.
It's actually doing your jobright.
It's not doing it to meet somekind of quota.
(24:20):
It's doing the job to make surethat you're doing the kind of
work to get the talent that isavailable and giving them an
opportunity to succeed.
I hope this helps a little bit,because I believe that the
requirements of how you hirepeople is dependent upon the
leader.
You have to take theresponsibility to do a good job
(24:43):
of pulling in the best candidatefor your organization and if
you do a wide net, you're goingto do a very good job.
If you do it from your favoriteschool and from that one
university, I guarantee youyou're going to find yourself
trapped by that very parochialview of looking at one
opportunity Expand and you'llalways do better than trying to
(25:06):
do it in a vacuum.
So, if you like what you'veheard, yeah, I've written a book
called Building your LeadershipToolbox where we talk about
subjects like this, and the bookis available on Amazoncom and
Barnes Noble and other formats.
The podcast is available onwhat you're listening to, thank
(25:28):
you.
It's also available on thingslike Apple and Google and
Spotify, google and Spotify.
A lot of what Greg and I talkabout is from the MDR program
and that is really a very goodprogram that you can find on
successgrowthacademycom.
They have training programs andbooks available and a very good
course.
If you want to contact us, wehave a website called
(25:52):
wwwauthorjawcom and the musichas been brought to you by my
grandson.
So we want to hear from you.
We appreciate the input.
We've modified our programs onsome of the comments that we've
received from you and we arealways encouraging you to try to
(26:13):
give us a hand on what youthink is important that we
should cover.
So thanks, greg.
Speaker 1 (26:19):
Thanks, john, as always.
Speaker 2 (26:22):
Next time yeah.
I'm your host, john Wendolowski, and I'm here with
my co-host and friend, gregPowell.
Hey, everybody, yeah, and todaywe're going to talk about a
subject that I think is veryimportant, especially right now,
in terms of a subject that Ithink has a lot of conversations
(00:43):
about.
I believe that the hiringprocess is a very important
process to talk about and maybegive it a little bit more of a
definition.
When I think about the subjectand I know a little bit of the
background of the hiring process, there's so much to it that
really doesn't meet the eye, andwhen people talk about whether
(01:03):
they're doing a good job hiringpeople, I'm going to push back
and say prove it, because I'veseen more people doing it wrong
and people that I've hadreporting to me doing it wrong,
and one of the things that I'vehad to work on to make sure that
they were doing it right.
The best example I can give isI'm an engineer and I did a lot
(01:24):
of construction work and it wasalways interesting to hear how
you're doing.
A gold standard or a silverstandard or a platinum level,
kind of environmental, epa, kindof building, and these ratings
are very important in terms ofthe quality of construction and
(01:44):
the organizations that I wasworking for wouldn't pay for
these additional awards, but wewould go over and say that we
were capable of either hitting abronze or a silver or a gold.
Most of the work that I wasinvolved with was either gold or
platinum, because we weredealing with the right materials
, the right supplies, the rightkind of engineering approach in
(02:06):
terms of success, in terms ofresults that you're expecting
from heating systems and coolingsystems.
It's doing it right the firsttime.
Very basic.
It is not exclusive to justengineering.
It does mean the same thing ina hiring process.
It does mean the same thing inthe hiring process Understand
what's involved in terms of whatit means to hire.
(02:27):
To be in my world, to beinclusive, is to be accurate and
to be complete and to give agood picture of what you're
looking for for a new candidate,a new employee.
I'm going to actually hand thisover to our HR professional.
(02:48):
Greg, with the experience thatyou've had in this field, why
don't you kind of warm up thesubject of what it means to hire
the right way?
Speaker 1 (02:55):
Thanks, john.
So introduction to this topicwould be something like this A
key challenge for companiestoday is the battle for
attracting and retaining toptalent.
You got to get engaged in thatbattle.
You got to do it well.
The right talent drives thebest results of those best
business results.
So the challenge cascades downto a responsibility for hiring
(03:16):
managers to find this talent.
They've got HR support andthey've also developed an
interview team that's helpingthem source and appraise the
best candidates possible.
But to achieve a successfuloutcome requires much more than
simply posting a generic jobopportunity on a random job
board.
So let's talk about some keyconsiderations.
Create clear job descriptionsthat emphasize skills,
(03:39):
experience and competencies thatare really needed for the job.
Consider removing identifyinginformation from resumes and
applications that might cause alittle bit of bias to come out.
Develop standardized interviewquestions, including behavioral
interview questions, for allcandidates so that you minimize
those unconscious biassituations.
Assemble interview panels withindividuals from different
(04:03):
departments and differentbackgrounds to leverage diverse
perspectives.
Use structured assessmentmethods like skills tests or job
simulations to objectivelymeasure candidates' abilities.
Company's mission, values,vision, culture includes things
(04:28):
like their attitude towardscollaboration, innovation and
inclusivity.
Provide ongoing training forhiring managers and interviews
on recognizing and mitigatingthe problem of unconscious bias.
Conduct regular skills tests onthe hiring process and expand
your reach past a wider net andwe'll get into that a little bit
more as we go along here andfinally, summarize the
(04:49):
recruiting strategies to createan inclusive hiring process that
focuses on candidates,qualifications and potential.
John.
Speaker 2 (04:59):
And Greg.
Those are the points that Ireally wanted to try to
emphasize during this podcast.
There's so much more to hiring,but you can do it right and you
can do it wrong.
The examples that I've foundthat have been interesting is
understanding your culture,understand the department and
(05:19):
the organization that you'reworking with.
Can you describe the culturethat you're working in
organization that you're workingwith?
Can you describe the culturethat you're working in?
Can you describe the culture ofthe person that you're looking
for and how they would fit thatculture?
More importantly for me isskills.
Now I found a very interestingarticle called Competency Over
Credentials the Rise ofSkill-Based Hiring from the
(05:41):
Boston Consulting Group, andthey had this great article on
the rise in skills of basedhiring from December 11th 2023,
which I think is important.
So, in terms of the authors,I'm just going to say you should
look it up there.
It's a great group, but there'salso hard names for me to
(06:01):
pronounce, so I'm going to moveon and talk about their article.
I found their first sentenceprobably the most interesting.
It's been the call of the deathof the degree, and static
college degrees seem to be lessrelevant with the rapid change
in technology.
Employees are now asked to havemore dynamic, involved skills
(06:27):
and to up those skills again andagain, because the industry is
changing all the time.
People looking for employmentagree with their 2022 BCG survey
that many of the job seekerswish that they could look for
more skill and experienceinstead of degrees and
certificates, and now many ofthe companies are doing just
(06:47):
that, but how much and howsuccessful.
To be a little bit more precise, they went through and BCG
worked with Lightcast and theyfound a way of doing a big data
research of over 20 million jobpostings, and I think that's the
important point of this article.
This is a pretty broad strokeof the brush to see what it
(07:12):
means in terms of a degree andskills they go on and talk about
.
As noted that technology is thedriving constant and the need
for new skills, especially inthe advent of AI and generative
AI, but according to Pearson'sBusiness School Research, only
13% of the college graduateshave the skills needed to start
(07:35):
a job right away.
Furthermore, 54% of collegegraduates don't work in the
original field of study.
You put a point on that.
The jobs that will be availablein five or ten years may not
even exist today.
For all of these reasons, thevalue of a traditional degree
has become a question mark.
At the same time, organizationsare struggling to find talent
(07:59):
that they need.
Unemployment remains remarkablylow for a workforce that is
aging, and open positions remainunfilled.
Moreover, employees that expectto have the opportunity to
evolve workers increase theirmobility and they also are
looking for flexibility.
They are also on hold for thepower of the market to see where
(08:24):
the greatest competition is atand where talent is being
actually pulled.
Meanwhile, candidates areself-taught who are gaining
their skills and theirexperience and becoming the
major workforce in the labormarket.
In the US alone, 70 millionpeople can be categorized as
STARS, which is workers withoutbachelor's degrees that are
(08:47):
skilled through alternate routes.
Stars, the ensuing tug of warbetween skilled individuals and
organizations must rethink theirapproach to recruitment.
They must widen theirrecruitment lens to capture the
diversity of skills and theirexperience of changing
(09:09):
workforces.
They need to shift from thedegree to the pedigree, the will
and the skill To embrace theskill-based hiring.
They have to tear down thepaper ceiling that keeps
individuals without a degreefrom entering certain
occupations and advancing towhere they can be productive.
(09:34):
Educational credentials are notonly indicators of success.
We also advance to approach andhire on skills, experience and
potential.
Now they did talk about thepaper ceiling and how it doesn't
erode across all marketplaces.
(09:55):
In the United States you seealmost a 4% drop in degree-based
requirements, where Canada seesa little bit of an increase.
The UK and Australia areshowing both like 1.8, 1.6 kind
of drop.
Singapore, on the other hand,has asked for more degree type
(10:17):
individuals by the tune of likefive, five and a half percent.
So a paper ceiling, I think, isthe piece that I want to
challenge.
But I also want to bring up thepoint that this article is
talking about skills and culturejust as much as paper, and
that's really the theme of ourpodcast today.
Greg, maybe you can add to thatconcept a little bit.
Speaker 1 (10:41):
Yeah, thanks, john.
There is definitely a paradigmshift from having degrees and
focusing on degrees to learningabout importance and the need
for skills.
The US leads a shift toskills-based hiring across
career areas.
Many large employers with asizable US labor force are
embracing the trend Companieslike Dell, accenture, ibm.
(11:03):
Us government is too.
In fact, back in January of2021, the White House announced
limits on the use of educationalrequirements when hiring for IT
positions, lookingpredominantly at college degrees
.
It said let's be careful not toexclude capable candidates and
make sure that we're notundermining the labor market
efficiencies.
So degree-based hiring isessentially likely to exclude
(11:25):
qualified candidates for jobsAgain, folks that have the
ability and capability andskills to do the job.
You don't want to eliminatethem.
In Canada, uk, australia andSingapore, there's a lesser
shift and a different mix ofcareer areas affected, and
there's a chart that talks alittle bit about that.
I'm going to ask John toexpound on that a little bit.
(11:47):
Yeah.
Speaker 2 (11:50):
What they were doing.
The original graph that theywere showing was the United
States showing a three I'm sorry, 4% kind of drop and at the end
of the day, they had all thesedifferent trades that they were
talking about Agriculture,business, communication, finance
, healthcare, transportation,you name it.
(12:12):
In the States, across the board, they can see a decrease in
terms of people looking fordegrees, and it's not by 1% or
2%, it's like 18% in agriculture, 6% in clerical and
administrative positions, 10% inconstruction.
So people are starting tounderstand that in a tighter
(12:35):
working pool that talent is outthere.
They may not have a degree, butthey can show the capacity of
doing it.
Speaker 1 (12:45):
Greg, engineering is the only field where the paper
ceiling remains in place, andJohn and I talked about that a
little bit.
I was hearkening back to myprevious role in HR for a
company that used a lot ofelectrical engineers and power
systems engineers, and John'sown experience in education
would support this as well.
So employers in four out offive countries have increased
(13:08):
the demand for degrees in thisfield engineering.
This may have to do with safetyconcerns, regulations affecting
such roles, as well as thehighly specialized nature of
engineering jobs.
Shorter courses and on-the-joblearning may not easily replace
the competency needed to getthose degrees.
Speaker 2 (13:27):
Yeah, and what was interesting is that while you're
looking at hiring and you'relooking for whether skills make
sense, there's a wonderfularticle that I came across and
it's a message from the AmericanPsychological Association that
(13:47):
they delivered years ago thatstill stands true today To hire
on skill versus one that's oneducation.
You are five times more likelyto predict job performance.
For their analysis, they lookedat the promotion rate and the
tenure for these companies,using US as an example only,
(14:08):
because basically the UnitedStates was the pioneer in
skill-based hiring.
The promotion rate generallythose hired based on their
skills get promoted at a ratecomparable to traditional hires
and they will only see 2% lesslikely on the average to be
promoted in the same period oftime.
This suggests that skill-basedhires perform at the same level,
(14:35):
similar to their peers who havedegrees, and they are first
ones to be able to actually seethe opportunity for promotions
because of their experience andhow they actually work within
the organization.
Skill-based hires for thingslike community social services,
(14:56):
hospitals, healthcare, education, customer service kind of
positions all those show a realtrend to skill-based hires
rather than degree-type hires,and I think the challenge for
anyone that's trying to hireright now is to be able to make
(15:16):
the distinction between what isa skill-based hire versus a
degree Degree is kind of asafety net For me.
The article is talking abouthow these degrees sometimes have
no relevance to what theindustry is doing currently.
For me, I always consideredsomeone with a degree as the
capacity to show that they'rewilling to learn.
You gain that same kind ofmentality if the person has
(15:39):
built their skills in the samekind of methodical approach
basic to advanced to be able toshow and demonstrate those kinds
of skill sets.
The other interesting technicalpart of hiring by skill is the
type of people that you'rehiring are going to stay with
(16:00):
the organization.
They tend to stay for a longerperiod of time an average of 9%
longer than other skilled tradehires.
And that trend is true in mostindustries and professions
because it is pronounced in thetrades and the transportation
and food industries, as well asin the public administration,
(16:26):
the information, thecommunication technology,
professional services.
They all stay longer.
Their experts underscore thetrend of skill-based hires, have
better problem-solving skillsand, in general, have more
interest in exploring the firm,the company that they're working
for.
So their experts found thatthere was a trend that
(16:47):
skill-based hires have hadbetter problem solving skills
and were more interested in theorganizations that they were
working for.
That kind of approachdemonstrate their high
engagement and their motivation.
That's really what you'relooking for when you're hiring
someone.
Those are the ones, those arethe skills that you're looking
for.
More so, the character, theculture those are the key words
(17:10):
that you should be looking atwhen you're hiring.
Greg.
Why don't you roll this into alittle bit of a better
description?
Speaker 1 (17:16):
Thanks, john.
How can organizations succeedwith skills-based hiring?
So the first thing is challengethe biases in your talent
strategy today.
Be more open-minded.
Is a degree really required fora specific job?
We've got data that indicatesthat the paper ceiling is
vanishing even in jobs thattraditionally call for a degree.
(17:38):
Goldman Sachs recently shiftedto what is called a skill set
recruiting approach Through thecompany's new online platform.
Candidates don't apply for jobs.
They apply to specific skillareas, then participate in skill
testing and get referred forthe most relevant jobs based on
their skill sets.
Know the skills you need.
We've got research that saysthat skills-based job ads
(18:00):
include a higher number ofskills than traditional job ads.
Traditional data scientist jobads, for example, list
approximately 28 needed skills,whereas skills-based ads for the
same role will list as many as37 skills needed.
So skill-based ads especiallyover-indexed on transferable
skills such as collaboration,communication, which can be a
(18:23):
foundation for success in anyjob.
Up your skill assessment game.
The big risk when hiring peoplebased on skills rather than a
degree especially a degree froma tried and true institution is
the lack of proxy proof ofcandidates' qualifications.
So instead, employers have toobtain that proof by assessing
(18:44):
and testing candidate skills,which they often are prepared to
do or don't know how to do itefficiently.
They can look at other proxieslike micro-credentials, learning
badges from short often digitalcourses.
I think you get the picture.
They could also test candidatesby asking them to demonstrate
skills like writing code,participating in a trial period,
(19:06):
things like that A supportiveand inclusive culture.
Sometimes the main barrier toskills-based hiring is cultural
Managers want to hire people whowent to the same schools they
went to.
Recruiters don't want to take arisk on people from
nontraditional backgrounds.
Many company leaders followtraditional routes and expect
(19:27):
their successors to do the same.
In such an environment,skills-based hires may feel
discriminated against or simplyjust not welcome.
So, john, we talk about castinga wider net, and so I'm not
going to pick on any schools inparticular, but if you always
went to such and such state orsuch and such university because
they're top notch in winningawards and notoriety and maybe
(19:52):
teaching a discipline that youneed, you forgot that there are
other schools that are also verygood.
They might be smaller, have notthe notoriety, but offer the
same kind of training.
No-transcript.
Speaker 2 (20:12):
And we talked about this in one of the other like
casting a wider net.
I had technical positions,military people across the board
who have gone from an entrylevel and shown progression
through their technicalpositions to a higher ranking,
demonstrated the skill sets anddo a very good job of
(20:35):
understanding what shift workmeans, working in order to get
results.
They're motivated, they'rewonderful employees and that
broader net, that whole idea oflooking for better examples of
what we're looking for for anemployee and culture fit in very
well in what a lot of militarypeople that I hired and culture
(20:57):
fit in very well in what a lotof military people that I hired.
Speaker 1 (21:01):
So yeah, Greg.
So, John, let me build on that.
I worked for a gentleman whowas a former general in the Army
, ran logistics for a very bigretailer, and we found out that
folks that had worked in themilitary liked working in
logistics centers.
They didn't mind shift work,they understood the importance
of product not moving it toomuch, knowing where you put
(21:22):
things, discipline, safety thatwas their life, and we started
creating a channel of recruitingopportunity there.
And my last company,engineering company we found
some folks in the Navy that didexactly what we do, and if we
didn't seek out folks from theNavy, we've missed an incredible
opportunity for some talent.
And so, again, casting thatwider net is going to be
(21:44):
non-traditional places to getreally qualified folks, and some
may have degrees, some may not,Some may have certifications
that they've earned in themilitary net and proven they can
do the job right.
So so that's what we're talkingabout when we talk about
casting a letter net.
So then let's keep thinkingabout skill base.
It's not just about hiring.
(22:04):
After they brought skills-basedhires into their teams,
employers should continue tosupport those employees through
career progression.
So promotion should be based onskills and should other
internal moves and talentdecisions.
So the reason you brought themup to the company?
Because their skills shouldhelp them stay with the company
and progress throughout yourorganization.
So several talent marketplacetools help facilitate this.
(22:27):
However, a move like thisrequires a significant mindset
shift in the organization fromtalent hoarding to talent
sharing, from talent hoarding totalent sharing.
So managers as well as the HRfunction need to get more
comfortable with enablingskills-based, flexible career
paths.
So just because you broughtthis person in and you took that
risk they're doing a good jobfor you doesn't mean they're
going to stay in your particularpart of the organization.
(22:47):
They may stay with the company,but be willing to give up that
asset.
John.
Speaker 2 (22:52):
And that's career development.
If you're doing something forthe employee and that you're
going to really appreciate, it'snot holding them back from
going laterally and having anopportunity to grow.
If you're doing your job rightas a leader, you're trying to
encourage other departments.
If they see that opportunityfor advancement, they deserve it
and that's one of the positivethings is that you're hiring
(23:15):
good people that can work in theorganization in other locations
.
I'll tell you right now that'sgoing to help your career as
much as it's going to help theircareer.
So let's try to wrap this upand try to give you a little bit
of an idea of what we're tryingto talk about here.
Skills are really as importantas having a degree.
(23:37):
Understanding what is a cultureof your environment, of your
workforce, of your workapplication is just as important
as doing a good job of puttingin an ad and having the right
words on what you're looking forfor an employee, because you're
spending a little bit more timedetailing what you're looking
for and hopefully people can seethat connection.
(23:59):
And probably the most importantthing is throwing that wider
net being open to differentpeople and different
opportunities.
Is that inclusive?
You bet it is, but that isn'tthat it's a bad idea.
It is actually beingprofessional.
It's actually doing your jobright.
It's not doing it to meet somekind of quota.
(24:20):
It's doing the job to make surethat you're doing the kind of
work to get the talent that isavailable and giving them an
opportunity to succeed.
I hope this helps a little bit,because I believe that the
requirements of how you hirepeople is dependent upon the
leader.
You have to take theresponsibility to do a good job
(24:43):
of pulling in the best candidatefor your organization and if
you do a wide net, you're goingto do a very good job.
If you do it from your favoriteschool and from that one
university, I guarantee youyou're going to find yourself
trapped by that very parochialview of looking at one
opportunity Expand and you'llalways do better than trying to
(25:06):
do it in a vacuum.
So, if you like what you'veheard, yeah, I've written a book
called Building your LeadershipToolbox where we talk about
subjects like this, and the bookis available on Amazoncom and
Barnes Noble and other formats.
The podcast is available onwhat you're listening to, thank
(25:28):
you.
It's also available on thingslike Apple and Google and
Spotify, google and Spotify.
A lot of what Greg and I talkabout is from the MDR program
and that is really a very goodprogram that you can find on
successgrowthacademycom.
They have training programs andbooks available and a very good
course.
If you want to contact us, wehave a website called
(25:52):
wwwauthorjawcom and the musichas been brought to you by my
grandson.
So we want to hear from you.
We appreciate the input.
We've modified our programs onsome of the comments that we've
received from you and we arealways encouraging you to try to
(26:13):
give us a hand on what youthink is important that we
should cover.
So thanks, greg.
Speaker 1 (26:19):
Thanks, john, as always.
Speaker 2 (26:22):
Next time yeah.
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