Why are Companies Eliminating Degree Requirements ?

University graduates

by Bryan Hyland, Commercial Director at Morgan McKinley

Talent shortages in development, DevOps, cybersecurity, and cloud computing (among other areas of technology) are forcing companies to rethink how they go about hiring people for tech jobs.

The competitive nature of technology recruitment has been brought about by critical talent shortages. There is a glaring gap between the number of available positions and the number of suitable people who are available to fill them.

To counter this, many organisations are shifting away from requiring specific degrees and levels of education in favour of looking for candidates with relevant skills and experience that equip them to successfully do the job.

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This article will examine why companies are shifting to skill-based hiring and how making that decision can amplify your candidate pool.

The Great Resignation and staffing shortages

Even before the Great Resignation, there was already a chronic shortage of high-quality tech talent.

Some experts believe that there are currently over 450,000 open cybersecurity jobs alone.

As more industries adopt tech-based solutions, these talent shortages worsen because more companies increasingly rely on cloud technologies and cyber-infrastructure, and therefore more organisations are looking to hire people to work within and maintain their technologies.

For example, many companies now use electronic invoicing and often look for invoicing templates that come with features such as professional layouts and cloud storage. But using these modern technologies may bring with it additional cybersecurity risks and as a result, cybersecurity professionals need to be hired to protect against them.

In other words, the wider adoption of technology is further fuelling the personnel issues which are already rife across the sector.

In an attempt to close the gap and tackle this issue, companies are reimagining what it takes to be ‘qualified’ for positions, broadening the type of people they are willing to hire.

The different approaches to take when hiring for tech jobs

Companies are taking a creative approach to plug the talent gap and come up with different recruitment strategies.

The latest trend, which is especially popular at tech companies and for start-ups that are recruiting tech talent, is eliminating degree requirements for jobs and instead focusing on hiring individuals based on their skills and competencies.

Reversing degree inflation by focusing on talent, skills and experience

One issue that workers have faced since the 2008 global financial crisis is the so-called ‘degree inflation’, where employers began requiring degrees for jobs that previously had never needed them.

In many cases, the jobs never changed, just the degree requirements, which led to an explosion in people taking out student loans in order to obtain higher education.

Today, many people are concerned about the cost of their student loans and the debt burdens they carry.

By getting rid of degree requirements, many more people become eligible for jobs they might not have previously qualified for.

  • Accenture only requires degrees for 26% of its job postings.
  • 50% of IBM’s U.S. job openings have no four-year degree requirement according to their Chief Human Resources Officer, Nickle LaMoreaux.
  • In January 2021, the White House limited the use of educational requirements when hiring IT professionals.

Playing the long game by training junior professionals

In 2016, Accenture created an apprenticeship programme in which young professionals are upskilled to suit the roles the company needs to fill.

Since then, 1,200 people have been hired directly from the programme, of whom around 80% began their apprenticeship without a four-year degree.

Similar programmes are also in development at other tech giants like Dell Technologies. Dell expanded its definition of the university requirement to include community colleges, so now associate degrees, apprenticeships, and certificate programmes are in the same category of consideration as university education.

Formal education is no longer the primary indicator of ability in Tech

Many cybersecurity roles often rely on certificate programmes. For example, both Google and Microsoft offer competency certificates in various fields.

Another popular certification path, CompTIA, offers rigorous testing to prove knowledge in specific fields.

Traditionally, degrees are used as a proxy to demonstrate knowledge or skills, but they often fall short of what a company needs.

These types of certification programs can help enthusiastic job-seekers become more employable without a four-year degree. In particular, recruitment into the cybersecurity field can benefit from utilising more forward-looking skill-based hiring.

Will other sectors follow suit?

It remains to be seen if eliminating degree requirements will expand to other industries.

However, the IT and tech industries have greatly benefited from adjusting their approaches to hiring in this way, and it acts as a positive case study of the success that hiring companies can have through broadening their recruitment horizons.