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Is Degree Deflation IT’s Solution for Hiring Challenges and Reducing Costs?

Date:
Jan. 03, 2020
Author:
Ryan Day

IT decision-makers have faced a harsh reality in recent years—they’ve struggled to hire qualified candidates to fill vacant or emerging job roles.

But the underlying problem isn’t necessarily the quality of the applicant pool, but rather the recruitment. What barriers has your organization put in place to filter out potentially unqualified applicants? Is your vetting process cutting off a pipeline to experienced and skilled IT professionals?

Hiring is now the biggest challenge for IT leaders. It’s time to reassess what constitutes a “qualified” job candidate.

 

Hiring challenges have led to an increase in skills gaps

During the hiring process, decision-makers and hiring managers are essentially looking to bring on new skill sets. When the right applicants aren’t available, those skills remain absent. This lack of necessary skills, also called a skills gap, is plaguing IT departments worldwide.

The Global Knowledge 2019 IT Skills and Salary Report uncovered that IT skills gaps are at an all-time high—directly impacting 79% of global IT departments and 81% in North America. That’s a 155% increase in three years—enough to send a chill down any manager’s spine.

Skills gaps are up, in large part, because decision-makers are unable to hire qualified talent. So what’s the fix?

 

Two solutions for hiring and finding qualified employees

  1. Train your current staff. It’s cheaper to upskill existing employees than it is to hire someone new. The Center for American Progress reports the cost of replacing a staff member is roughly 21% of their salary.1
  2. Adjust your hiring requirements.

The mere mention of “lowering standards” may scare off many managers. But in this case, reassessing hiring requirements will likely widen the talent pool and alleviate some of the challenges that decision-makers are facing.

 

What’s more important: a degree or skills?

The International Data Corporation (IDC) recently released a report that questions the requirement of a college degree for IT job applicants.2 The report doesn’t diminish the importance of higher education; instead it attempts to elevate the value of relevant skills during the hiring process.

What good is a bachelor’s degree to an employer if it’s not relevant to the job? And why is it being used as a filter to determine potential job candidates?

IDC’s report looks at research from the Federal Reserve Bank of Boston, which notes that a greater emphasis was placed on four-year degrees during the financial crisis in 2007. A wealth of degreed professionals were unemployed, so employers reactively increased skill requirements for open positions. Basically, they had a larger crop of experienced and educated candidates to choose from. The result was highly-proficient professionals accepting jobs below their skill level.

As the economy has improved over the last decade, the emphasis on a college degree has not diminished.

“The thinking was this will correct itself when the economy balances out and more people are hired, but it hasn’t corrected itself,” said Cushing Anderson, IDC vice president of IT Education and Certification and the author of the report. “At the time it was practical to raise our hiring criteria a little, but now it’s hard to unwind that.”

89% of IT jobs require a bachelor's degree, compared to 76% for non-tech industries.

It’s time to seriously consider “degree deflation”

According to a study by Georgetown University’s Center of Education in the Workforce, there will be 55 million job openings through 2020, of which 35% will require a bachelor’s degree.3

Many job candidates with no degree will immediately be filtered out by recruiters or their recruiting software. Resumes worthy of discussion will essentially be thrown in the trash and never see the desks of decision-makers who are desperate for skilled employees.

Anderson says IT organizations could benefit from “degree deflation,” which is a conscientious effort to attract candidates that do not hold a four-year degree to positions where skills or potential could be demonstrated in other ways.2 By deemphasizing degrees, an open pipeline to more candidates could emerge, leading to diminished skills gaps and potentially lower payroll.

“The good news is it’s only been 10 years,” Anderson told Global Knowledge. “It has not been a 50-year trend that we have to overcome. Current decision-makers may be unaware of the rationale that led to nearly universal addition of degree requirements for IT positions 10 years ago.”

It turns out the tech industry is more stringent when it comes to degree requirements as well. According to a report from Burning Glass Technologies, 89% of IT jobs require a bachelor’s degree, compared to 76% for non-tech industries.4 This type of prerequisite makes non-tech jobs more accessible than positions in the tech industry.

 

Certifications and training should be more valued during the hiring process

What if IT decision-makers and HR departments viewed certifications with the same level of credibility as college degrees? Certifications corroborate skill sets. And you can be assured that the expertise is current, as most certification-holders are required to recertify every two or three years to ensure their skills are valid and are constantly evolving.

For many functions within IT, there’s so much transformation that a degree may not accurately validate current abilities. A degree is an achievement in itself—it illustrates time management and presentation skills, among others—but the extent to which it demonstrates real-world capabilities in IT likely depends on how much time has passed since it was earned.

Global Knowledge Vice President of Global Infrastructure, Matt Stanyon-Tall, believes a college degree should not be a prerequisite for most roles, and not having one shouldn’t immediately disqualify job candidates.

“Degrees have previously been used as a terrible way to benchmark people, often with little relevance to the role,” Stanyon-Tall said. “At best it’s lazy; at worst it’s totally irrelevant.

90% of human resource leaders say they would hire a job candidate who can validate their knowledge with a certification or coursework instead of a degree.

Just think about the transformative nature of cybersecurity. Professionals in this field must constantly be upskilled and familiar with the latest social engineering tactics and cyber threats. For security professionals, certifications are more indicative of current skill sets than a college degree.

These types of assessment methods exist in IT. Decision-makers already put a lot of faith in certifications—in fact, 93% say certified employees provide added value to their organization. They don’t need to be sold on the value of certification as an assessment tool.

“They already have a lot of trust in certifications and training programs because they’ve seen people who have those things in action,” Anderson said.

Anderson also points out that a lot of skills aren’t “college-originated.” That’s where training comes in. The availability of IT training and resources is much different than it was a decade ago. IT professionals—whether they are designers, sysadmins, network engineers, etc.—can learn just as much through hands-on exercises, on-demand courses and self-study as they did in a college classroom. These individuals will need to use any or all of these learning methods to stay current anyway, whether they have a degree or not.

And opinions may be starting to shift. While 68% of employers still rely on college degrees to validate skills, 90% say they would hire job candidates who can validate their knowledge with a certification, digital badge or coursework instead of a degree.5

“(Certified individuals) have demonstrated they have IT acumen,” Anderson said. “Let’s be clear what a B.A. adds, and consider if there are other ways to skill-up an otherwise qualified candidate that doesn’t have a degree.”

 

How employees perform — with a degree versus without a degree

Of the 12,271 IT professionals who participated in our 2019 IT Skills and Salary Report, 89% have a college degree. And it’s clear that their salaries are significantly higher than peers without degrees.

In North America, IT pros with a college degree earn 29% more than their counterparts with no degree. The differential is 19% worldwide.

There’s not much difference in tenure between the two groups. In both cases, 15% have 1 to 5 years of experience. Sixty-six percent of those without a degree have 10-plus years of experience, versus 64% with a degree.

Other than base pay, there are few disparities between IT professionals with or without college degrees.

  With degree Without degree
Feel secure in their job 79% 79%
Are satisfied with their job 72% 71%
Are likely to look for a new job this year 52% 49%
Changed employers in the last year 21% 20%

 

IT professionals without a college degree are slightly more likely to be certified. Seventy-two percent have more than one IT certification, compared to 69% of those with a degree.

 

Advice to job seekers: Continual training sets you up for career success

Whether you have your college degree or not, as a professional, you should be constantly seeking ways to enhance and reinforce your skill set. It’s clear that managers with knowledge of the industry are drawn to individuals with relevant certifications and training. A degree may still be a barrier, but with hiring difficulties trending upward, organizations will have no choice but to devalue irrelevant degrees and focus more on the “can-do” skills of job applicants.

Traditional education routes are still encouraged, but other sources of skill development are essential for career progression. Technology changes too rapidly to fall back on the knowledge you attained years—or decades—ago.

Know that recent certifications and relevant experience are important hiring factors. Always seek to learn—it should be a lifelong activity. Managers are looking for skills that can translate immediately to their workplace. Don’t bury your current skills on your resume. Highlight your expertise and uplift your recent coursework and credentials.

 

Advice to hiring managers: Skills are what should matter

Is an open position worse than a position filled sooner by someone who may need some upskilling? It’s a small tradeoff in the short-term, with hopefully a larger payoff down the road when the new hire returns from training with new and impactful skills.

Also, when evaluating job applicants, know that a college degree isn’t the best representation of current abilities. A degree can be professionally relevant, but it shouldn’t outweigh other characteristics that a job candidate may possess. There is a lot of benefit in hiring an individual who possesses a strong desire to learn.

“When recruiting, I aim to take a balanced view of experience and aptitude, as well as education and professional training,” Stanyon-Tall said. “Technology, roles and ultimately organizations change, therefore having candidates who have the drive and the ability to grow with us is far more important. We can teach people the skills.”

IT skills gaps have risen 155% since 2016, in large part because decision-makers are struggling to find qualified job candidates.

Managers want to know one thing about a new hire—can they do what I need them to do? A degree doesn’t necessarily answer that question. But a recently-earned certification might. Relevant job experience might. These are the criteria that should be evaluated equally within your job candidate pool.

It’s time to rethink outdated policies. A college degree, while a strong marker of achievement, is an irrational hiring barrier. Ultimately, skills are what matter—it doesn’t matter where they come from. Lifelong learning is critical to keeping skills current. This should be the main focus during the hiring process.

Given the amount of open tech positions and time needed to fill them, plus all of the other delays that disrupt IT, organizations and departments would be wise to lower their hiring standards. There may be more qualified candidates available than they initially realized.

 

References

  1. There Are Significant Business Costs to Replacing Employees, Center for American Progress, Nov. 2012
  2. IDC, The Hidden Solution to the IT Skills Gap: Degree Deflation, Doc # US45162419, June 2019
  3. Center of Education in the Workforce, Georgetown University, Recovery: Job Growth and Education Requirements through 2020
  4. Burning Glass Technologies, Beyond Tech: The Rising Demand for IT Skills in Non-Tech Industries, Aug. 2019
  5. Wiley Education Services and Future Workplace, Closing the Skills Gap 2019 Research Report

 

Resources

IT Skills and Salary Report