Many companies are shifting towards a new form of hiring that prioritizes applicants’ skills over traditional metrics such as education or years of experience. Data from job site Indeed shows that the share of U.S. online job postings listing specific employment tenure requirements has decreased by 10 percentage points, and the majority of job ads, 52%, no longer have formal education requirements. Additionally, mentions of college degrees have declined in 87% of occupational groups over the past few years, indicating a trend towards skills-based hiring.
A ZipRecruiter survey of 2,000 employers also confirms this shift towards skills-based hiring, where competencies are prioritized over traditional credentials. Almost half of the employers surveyed have eliminated degree requirements for some roles in the past year, with 72% now placing more emphasis on skills over certificates when evaluating job candidates. The trend towards valuing a candidate’s practical skills and real-world experience over formal education appears to be gaining momentum.
The increased focus on specific skills in job ads is making hiring managers more explicit about the qualities they seek in applicants. According to Cory Stahle, an economist at Indeed, there has been a noticeable change in the interview and hiring process to accommodate this shift towards skills-based hiring. This change in approach has been driven by the high demand for workers that followed the reopening of the U.S. economy after lockdowns, with businesses struggling to fill vacancies due to talent scarcity and intense competition.
While traditional measures of job fit, such as educational background, will continue to be important in certain professions, many employers are recognizing that formal qualifications do not always accurately reflect a candidate’s suitability for a role. This shift towards skills-based hiring is expected to create new career opportunities for job seekers and offer tangible benefits for both businesses and workers, such as higher retention rates for non-degree holders and significant salary increases for candidates without college degrees.
Despite the benefits of skills-based hiring, there are some limitations to this approach, including entrenched behavior among hiring managers. The Harvard Business School and Burning Glass Institute report that about 45% of firms have not made meaningful changes in their hiring behavior following the removal of stated requirements from job postings. This highlights the challenges that employers may face in fully embracing skills-based hiring practices.
For job seekers, it is important to align their resume with the skills-focused approach of potential employers. While skills should be highlighted in resumes, applicants should still provide a complete overview of their work history and education, as some hiring managers may still value traditional qualifications. Job candidates should also be prepared for skills tests during the hiring process, as some companies may use this method to assess applicants’ abilities. Ultimately, developing and demonstrating the identified skills will be key to success for job seekers in a skills-based hiring environment.
