Employers across industries are in dire need of skilled talent to meet the demands of the rapidly evolving workforce. As numerous sectors are upended by digital transformation — fueled by the availability of new technology like generative AI — the skills gaps between employees and their roles is continuing to widen.
In fact, a 2023 global survey found that 69% of business leaders will need different workforce skills to stay competitive by 2030. To address this, 76% of those leaders plan to increase their investment in upskilling, and 73% plan to invest in reskilling existing employees.
This need to build skills is particularly important for older workers who are considering leaving the workforce due to technological changes — and the 36 million workers in low-wage, high-churn jobs, the majority of whom do not have a degree and whose jobs are highly susceptible to automation.
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It's clear there is a stated need to find and train talent to succeed now and in the not-so-distant future. But there is a glaring disconnect between how the majority of workers hired in career pathway roles today are trained, versus the actual skills they need to succeed in the workforce.
What people learn in college may no longer be sufficient for the workforce of today. It begs the question: How can we better prepare the workforce for the jobs of tomorrow? Especially when research indicates that the traditional proxy — college degrees — may not be as valuable as once perceived.
The ROI of college
College is often positioned as the only pathway to a future career in a family-sustaining job — and due to degree inflation and the screening out of millions of workers without bachelor's degrees, it is. But, that doesn't come without its own set of issues for the millions of new enrollees every year.
Over the past 40 years, college tuition inflation has run at three-times the rate of the consumer price index — all while the educational output has largely remained the same. And that comes at a time when 40% of Americans who start a degree end up dropping out. Even for those who complete a four-year bachelor's degree and find jobs earning $40,000 to $70,000 a decade after starting college, many still carry significant debt.
Meanwhile, the reality is not all college graduates even end up with a well-paid job, and most graduates are not work-ready right after graduation. In fact, our recent Multiverse survey of business leaders found it takes almost one year for new grads to become completely effective in the workplace.
Similarly, the same survey found that two-thirds of business leaders believe the current higher education system is not well suited to deliver the skills needed for the workforce of tomorrow. Something has to give.
Thankfully, there is a dramatic shift occurring in the labor market, as more and more public and private employers announce their intention to tear the paper ceiling and find the talent that exists beyond the degree.
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Removing degree requirements
Following the Great Recession in 2008, companies began requiring college degrees for jobs that hadn't previously needed one. This degree discrimination changed the course of many job applicants' lives, since individuals skilled through alternative routes were passed over for those who had the degree but may have actually lacked the necessary skills to do the job. It also widened the racial equity gap as 72% of Black Americans and 79% of Hispanic Americans over the age of 25 do not have a bachelor's degree.
But the tides are turning. A 2022 report from Harvard Business School and the Burning Glass Institute found that we have entered a "degree reset" phase. This means that many employers are dropping degree requirements for a variety of roles and are focusing on specific skills instead. Although 44% of roles still require a degree, many employers are seeing the benefit of removing degree requirements to find employees who are most prepared for the job.
Where to find talent
As companies remove degree requirements and begin to source the 50% of workers who gained their skills through alternative routes, there are many places they can look to find the talent to fill their open roles.
One option is through online career sites and job boards, such as Indeed or LinkedIn which have tools that allow organizations to search for specific skills. Doing so allows for the direct targeting and recruitment of candidates that have the skills needed to fill a position — rather than seeing a degree as a proxy for those skills. As an extension to online career sites, social media platforms have become a great place to recruit talented individuals. Multiverse, for example, uses TikTok ads to recruit Gen Z talent for our apprenticeship programs and has seen great success in doing so.
Another oft-overlooked place to find talent is within your existing organization — which has proven to be a more cost-effective way to fill open roles than through outside hires. Many employees at companies today already have the skill set to thrive in upwardly mobile in-demand jobs. But a lack of understanding of skills adjacencies by both the worker and employer means neither side can take proper advantage of the opportunity.
When employers consider skills mapping and talent holistically — expanding their search beyond the degreed workforce and outside hires they currently consider — they can uncover an untold number of career pathways and sources of talent. Developing a clear understanding, and creating growth opportunities from entry-level jobs to corporate work, will improve retention, onboarding efficiency, and your company's bottom line.
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Build your own talent
Since college is increasingly proving to miss the mark on effectively training individuals to enter the workforce, it's time to reconsider society's perception of college and its subsequent degree requirements.
As important as it is to remove degree requirements, it is as important that there are true alternatives in place so that employers and individuals have something to turn towards. There are a few alternative methods that can provide the right skill set for various jobs.
- Apprenticeships: Though once viewed solely as training for trade-oriented jobs, apprenticeships today help individuals earn money while they learn in-demand skills for many different fields, including software engineering and project management. These apprenticeships allow individuals to earn while they learn and propel their career forward, while also providing skills to their employer. Often, their training lasts around the same length of time that it takes for college grads to become fully effective in their roles (i.e. about one year), and does not require the learner to take on any debt in the process.
- Military service: The majority (58%) of veterans don't have college degrees, but 78% of HR leaders believe veterans have the technical expertise needed for today's workforce. The applied learning and experience members of the military receive on the job can be effectively transferred into many civilian workforce roles, as well as the demand for soft skills like leadership, teamwork and resilience.
- Bootcamps: With the rise of tech jobs, bootcamps have become a popular way for individuals to gain broad technical skills in a relatively short period of time (between eight and 40 weeks) compared to the four years it takes to get a bachelor's degree in the same subject. Bootcamps often focus on specific skills related to web development, software engineering, cybersecurity, data science, or user experience design and the individual attending the program pays for access to the materials.
Hiring for a skills-based workforce
A 2022 report from McKinsey found that hiring for skills is five times more predictive of job performance than hiring for education, and employees without college degrees tend to stay in their roles 34% longer than those with degrees. And, since the majority of college graduates are not work-ready right after graduation, removing degree requirements from jobs will not hinder an employers' ability to hire talented individuals. In fact, it may help them find talent they wouldn't have found otherwise.
This mindset change is essential as employers grapple with today's so-called "skills gap" and focus on ways to diversify their workforce. Fortunately, employers are starting to see how workers can build skills outside of college, and are thus removing barriers to entry, but more must be done for us to see real lasting change.
