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January 14, 2023

Maya Varma

Data shows skills-based hiring diversifies the workforce

Strategies for businesses to fill roles with skilled tech talent.

By 2025, 97 million new tech-related roles are likely to emerge in the US job market. Even in the uncertain post-COVID economy, many industries have increased job postings for early career talent by more than 10% since last year. Some industries have also seen a rise in tech roles specifically—traditional software and computer tech roles in government industries were up 36% between 2021 and 2022.

Plenty of job opportunities exist for early career job seekers—even in a tough market—but traditional recruiting methods create barriers. For example, a college senior with a mathematics major might be immediately overlooked for a software engineer role because they won't be included in searches for CompSci or CompEng majors. But, they may have coding skills, like Python or C++, so when looking at skills, the candidate pool becomes even larger.

Competition is high for businesses that need to fill roles with skilled tech talent. And skills-based hiring is the means to solve this competitive conundrum of matching qualified talent to open roles.

Finding candidates based on skills, not pedigree

In a study conducted by Harvard Business Review, researchers found that racism, sexism, and ageism in the hiring process can unfairly eliminate candidates from the interview process. Even traditional screening processes like GPA requirements can sideline underrepresented groups.

Many companies are moving to skills-based recruiting as a more inclusive strategy by ditching requirements like degrees or GPA. Instead, they’re focusing on finding candidates with the specific skill or competency needed for the job. And it’s paying off.

According to Handshake data, a skills-based approach to recruiting increases the eligible talent pool by 2.3x. Expanding a talent search to include skills or interests yielded an even larger growth in the population of underrepresented candidates: 3x more veterans and 3.5x more women and Black students.

The importance of training, development, and skills

Despite the uncertainty around the economy, graduates are confident they have the training needed to take on these challenges. In fact, 77% of the class of 2022 believe they have the skills to land a full-time job.

Christian, a veteran who served nearly a decade in the United States Army, earned his bachelor's degree and MBA in Management Information Systems. While in school, he used Handshake to secure an internship with Amazon AWS where he used skills from both his studies and the military. After completing the internship, Amazon extended a full-time return offer to Christian. Looking back, he credits his military service with instilling several key lessons that pushed him to success in the tech world.

“Working in tech, everything is extremely systems based. So you have a system and you complete steps A, B, C, D,” says Christian, “and that’s the way the Army taught me to think, too.”

Students aren’t just bringing skills into their job, they’re looking to gain more once at a job. And that’s a benefit for employers. In fact, a survey of more than 1,500 students found they’re willing to stay at a company twice as long if they have growth and advancement opportunities. Skills not only bring candidates in—they can help retain them as well.

Inclusive hiring creating inclusive workplaces

Handshake already partners with more than 90% of colleges and universities as the official system of record to connect their learners with relevant employers and meaningful work. But we’ve learned that degree programs aren't the only way job seekers gain employable skills.

For instance, Coding it Forward (CIF) is a nonprofit that connects early technology professionals with opportunities in the public sector. Through their fellowship programs, CIF places hundreds of students in positions across more than 40 federal, state, and local government agencies—spanning data science, software engineering, design, and product management. Using Handshake’s unique network, CIF achieved a 187% increase in applicants from underrepresented groups.

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