The following article was authored by Susan Moore, and originally published in the Greater Houston Partnership Houston Report.
According to Partnership data, in 2018, roughly 3 million adults in the Houston MSA over the age of 25 did not hold a bachelor’s degree or higher degree. About 923,000 – or 20% - of adults over the age of 25 in the Houston MSA have taken some college courses but do not have a degree. Just more than 1 million individuals in that age group – 23% - have a high school diploma or GED but did not move on the college. And, about 736,000 adults over the age of 25 – or 16% - lack a high school diploma.
That nearly 3 million people – or roughly 60% of adults over the age of 25 – could be left out of the talent pool for well-paying jobs due to on one specific criterion: Whether they hold a bachelor’s degree.
According to the report “Dismissed by Degrees,” research conducted by Accenture, Grads of Life and the Harvard Business School, there is a significant discrepancy between the demand for a college degree in job postings and the number of employees currently in those jobs who have a college degree. It also highlights the adverse impact degree requirement have on employers who end up paying college degreed employees at a premium for these roles and then not retaining them.
Individuals without that degree but who might otherwise have the skills and knowledge to perform the job – and perform it well – may be dissuaded from applying or could have their applications dismissed on the bases of not meeting requirements. This specific educational attainment could also prevent otherwise qualified middle-skill workers from transitioning into advanced middle-skill and high-skilled occupations, as evidenced in UpSkill Houston’s July report “Navigating the Changing Nature of Work.”
While requiring a bachelor’s degree could leave a significant portion of the overall population out of good careers and progression, it could particularly hold back Black and Hispanic residents. According to Partnership data, more than 27% of Black and 15% of Hispanic adults over the age of 25 lack a bachelor’s or higher degree or higher degree. Just under 9% of Black adults are without a high school diploma; that percentage soars to just less than 36% of Hispanic adults.
Educational attainment appears to also impact household income. Rice University’s Kinder Institute for Urban Studies reported in its 2020 Kinder Houston Area Survey that the region’s U.S.-born Black and U.S.-born Hispanic residents were both twice as likely to have household incomes below $37,000 than U.S.-born Anglo residents. Hispanic immigrants were three times as likely.
But increasingly companies are removing the bachelor’s degree as a minimum requirement, opting instead for the degree or equivalent experience or simply focusing on experience with no degree preference – particularly in tech areas. Examples include Apple, Google and IBM. Earlier this year, Tesla boss Elon Musk announced via Twitter that educational background was irrelevant to work in his artificial intelligence (AI) department.
As recently as June, the federal government announced steps to adopt this shift, too. By presidential order, the U.S. Office of Personnel Management is to revise its job qualifications, de-emphasizing whether an applicant has a college degree and placing more weight on an applicant’s skills. The order acknowledges an unclear relationship between holding a degree and having a strong skillset and specifically cites degree barriers as barriers to economic mobility inclusivity.
“Degree-based hiring is especially likely to exclude qualified candidates for jobs related to emerging technologies and those with weak connections between educational attainment and the skills or competencies required to perform them. Moreover, unnecessary obstacles to opportunity disproportionately burden low-income Americans and decrease economic mobility,” the order states. “Modernizing our country’s processes for identifying and hiring talent will provide America a more inclusive and demand-driven labor force,” it reads.
Making the Shift to Skills-Based Hiring
The Markle Foundation’s Skillful initiative, which is dedicated to enable all Americans, and particularly those without a four-year degree, to secure good jobs in a changing economy, characterizes a “skills-based” job posting as one that uses competencies to attract candidates with the skills required for the job, distinguishes qualification between required and preferred competencies and reduces bias by using inclusive language.
By contrast, a “pedigree-based” posting uses credentials (like a degree or work experience) to assume a skill level, lists qualifications that lack specificity and prioritization and may include unintentional bias creating barriers to qualified applicants.
Skillful operates in in Colorado and Indiana, and facilitates the Skillful State Network, a coalition of 20 state governors to accelerate development and deployment of effective skills-based practices to transform their labor markets.
It offers a four-step guide for writing a skills-based job posting to help employers get started, and shares success stories.
Companies can begin the process by identifying the skills employees need to carry out specific duties in their particular roles.
UpSkill Houston believes that by considering the skills individuals need to perform well in a role and seeking them out in a talent pool, employers can help Houstonians connect to good jobs and increase economic opportunity and prosperity for all.
Learn more about the initiative and its work.