How Skills-First Hiring Impacts Diverse Talent Pools

Despite reports to the contrary, DEI hasn’t fallen off of any hiring radar. In fact, according to Jobvite data, 75% of HR professionals stated that their company would prioritize diversity hiring in 2024. But this is where the challenge arises – good intentions are one thing, but the practicalities of diversifying your recruiting methods can often stall the cause.

Traditional hiring practices are often ill-equipped to find a broad range of talent, relying on conservative yard sticks like degrees or years of experience as proxies for ability. But skills-first hiring might offer a solution to this. Emerging as a credible means of building more diverse and inclusive talent pools, skills-first hiring can help break down barriers and allow more top talent for different backgrounds and sources to flow through. And it’s a growing methodology – companies like Boeing, Wallmart, and IBM are all adopting and including a skills-first approach to create more job opportunities for underrepresented talent.

Let’s discover how.

Understanding Skills-First Hiring

Skills-first hiring emphasizes a candidate’s specific abilities and practical knowledge over traditional qualifications like degrees or years of experience. This approach assesses candidates based on their capacity to perform job-specific tasks, irrespective of how they acquired their skills. According to the Harvard Business Review, 62% of companies reported increased workforce diversity after adopting skills-first hiring practices.

Learn more: How to Get Hiring Managers On-Board with Skills-First Hiring

Why Skills-First Hiring Increases Diversity

To understand the impact of skills-first hiring on diversity, we must explore how traditional hiring practices often limit diverse talent pools. Conventional methods typically favor candidates with specific educational backgrounds or extensive experience, which can inadvertently exclude capable individuals who have taken non-traditional paths. Here’s why skills-first hiring makes a difference:

1. Eliminates Traditional Barriers: Traditional hiring often emphasizes degrees from prestigious institutions and specific job titles, which can exclude talented individuals from less conventional backgrounds. By focusing on skills, organizations can assess candidates based on their ability to perform the job rather than their educational pedigree. A study by Opportunity@Work found that there are 71 million skilled workers in America who do not have a college degree. Think of the potential!

2. Encourages Non-Traditional Candidates: Skills-first hiring attracts candidates who might be self-taught or who have gained their expertise through community colleges, bootcamps, or online courses. This approach broadens the recruitment funnel, making it more inclusive. For example, LinkedIn reports that by adopting a skills-first approach to hiring you can increase your talent pool by 10x.

3. Mitigates Unconscious Bias: Traditional hiring criteria can perpetuate unconscious biases related to educational and professional backgrounds. Skills-first hiring minimizes these biases by evaluating candidates solely on their competencies. Research conducted by TestGorilla has shown that bias in the hiring process has risen by almost 50% – but 84% of employees feel that a skills-first approach could help reduce this occurrence.

4. Opens Opportunities for Underrepresented Groups: Skills-first hiring can help bridge gaps in sectors where diversity is lacking. For instance, tech-related fields often see significant gender and ethnic disparities. By focusing on specific programming skills and problem-solving abilities, organizations can attract a broader range of candidates, including women and minorities who may not have a traditional Computer Science degree.

Learn more: 9 Types of Bias and the Ways They Affect Your Recruiting Efforts

Implementing Skills-First Hiring to Enhance Diversity

To effectively leverage skills-first hiring for diversity, organizations should follow these actionable steps:

• Identify Areas for Improvement: Analyze sectors or roles within your organization where diversity is lacking and where skill requirements are concrete and measurable. This could be in tech roles where there is a gender gap or in leadership positions lacking ethnic diversity.

• Redefine Job Descriptions: Shift the focus of job descriptions from educational qualifications to essential skills and competencies. For example, instead of requiring a Computer Science degree for a tech role, specify the necessary programming languages, tools, and problem-solving abilities.

• Develop Skills Assessments: Create practical tests or simulations relevant to the job tasks to evaluate candidates’ skills directly. For instance, for a customer service role, design an assessment that tests candidates’ ability to handle customer queries effectively. 

• Utilize Blind Hiring Techniques: Implement blind hiring practices where candidates’ names, educational backgrounds, and other identifying information are removed from applications. This helps focus on skills and reduces biases.

• Promote Diverse Pathways: Encourage and recognize alternative pathways to acquiring skills, such as online courses, coding bootcamps, and community college programs. Highlight these options in job postings to signal openness to non-traditional candidates – if you are open about how you are hiring, talent will respond in kind.

• Provide Inclusive Training and Onboarding: Ensure that training and onboarding processes are inclusive and supportive of candidates from diverse backgrounds. This can involve providing additional resources or mentoring to help new hires integrate smoothly.

Learn more: How to Write More Inclusive Job Descriptions

The Impact of Skills-First Hiring on Organizational Diversity

It may seem easier to stick with the hiring status-quo rather than implement such a big change, but there is so much worth in broadening your perspective. While skills-based hiring doesn’t necessarily need to be employed for every hire, if diversity or talent shortages are an issue for your organization, it’s definitely worth considering. And remember, skills-first hiring not only helps in building a diverse workforce but also aligns with broader organizational goals:

1. Enhanced Innovation: Diverse teams bring varied perspectives, fostering creativity and innovation. A McKinsey report found that companies with diverse workforces are 27% more likely to outperform their peers in terms of profitability.

2. Improved Employee Engagement: Employees from diverse backgrounds often feel more valued and engaged in inclusive environments. 

3. Better Customer Understanding: A diverse workforce can better understand and serve a varied customer base, leading to improved customer satisfaction and loyalty.

Conclusion

Skills-first hiring is a powerful tool for enhancing workforce diversity and creating a more inclusive recruitment process. By focusing on candidates’ abilities and practical knowledge rather than traditional qualifications, organizations can tap into a broader talent pool, reduce unconscious biases, and build a more diverse and capable workforce.

As the job market continues to evolve, adopting skills-first hiring practices not only meets the immediate needs of filling roles efficiently but also supports long-term diversity and inclusion goals. By breaking down traditional barriers and valuing diverse pathways to skill acquisition, organizations can foster a more innovative, engaged, and representative workforce.

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