Chanel Washington-Bacon spent years beating herself up for not finishing college. Long after entering the workforce, it bothered her that she didn’t have a four-year degree.
But after the Atlanta project manager connected with OneTen, a coalition of top employers focused on career development for black professionals and others without a college education, her sense of inadequacy became more apparent. My feelings began to change.
Washington-Bacon moved to Cisco Systems, a Silicon Valley manufacturer of routers and networking equipment, where he currently supports the U.S. commercial sales team as a business analyst.
“Getting into the world of technology is not easy; it usually requires a degree,” she says. But “it’s time for a change. Just because you don’t have a four-year degree doesn’t mean you don’t have the skills to do the job.”
Washington Bacon is part of the “new collar” workforce, people who are hired and promoted for their skill sets, regardless of whether they graduated from college or not. The practice, also known as skill-based hiring, is gaining momentum as a tight labor market pressures employers to place less emphasis on degrees.
New Collar’s work ranges from construction management to website development, sales to event planning. The term refers less to a role and more to how an employer fills that role. Proponents argue that skill-based employment could increase job opportunities and raise wages for the nearly two-thirds of the U.S. workforce without a degree. This rate is higher among Black, Latino, and Indigenous workers. It also provides employers with a broader talent pool and higher retention rates.
Companies that have taken this approach include IBM, Aon, General Motors, Walmart, and ExxonMobil. But critics warn that efforts to move away from traditional degree-based hiring may be superficial and that more efforts are needed to ensure the change does not become a passing fad. are.
Bridget Gaynor, global head of communications and policy at professional services firm Aon, is one of the executives promoting new-collar working through apprenticeship programs. For years, she says, employers have focused on improving the supply of workers, including “having to go to better schools.” Instead, “express your needs more clearly” by assessing what skills the role requires and thinking more creatively about which employees could fill the role. There is a need.
Aon’s two-year apprenticeship program is affiliated with the City Colleges of Chicago, and apprentices attend classes one day a week and spend the other four days on the job. The company said it has hired more than 200 apprentices since the program began in 2017, first in analyst roles and then in areas such as health, cyber and reinsurance. The program has since expanded to include employers such as Accenture, McDonald’s, and Walgreens.
“What we’re trying to do is change the demand,” Gaynor said. “We’re very focused on the supply side of the equation. We’re very focused on the demand side of the equation, and that’s what benefits us.”
The term “new collar” was coined in 2016 by then-IBM CEO Ginni Rometty, and in addition to the familiar “blue” and “white” color distinction, the term “new collar” was coined in 2016 to refer to fields related to clean color. Recent names such as “green collar” to refer to work have also been added. energy.
Additionally, up to a third of employees at some IBM locations did not have a four-year degree, Rometty said. In an op-ed in USA Today, she wrote that the federal government should “provide relevant career education and He argued that the focus should be on “technical education.”
Nearly a decade later, experts are making the same argument. Matt Siegelman, director of the Burning Glass Institute think tank, said degrees are an “inefficient” signaling device for a candidate’s abilities. Reliance on them can shrink the labor pool and limit the professional growth of talented workers, he says. “We’re tripping over our shoelaces… by creating talent shortages where there’s no need.”
Employer preference for degrees peaked during the Great Recession, said Colleen Ammerman, director of the Race, Gender and Equity Initiative at Harvard Business School. With so many candidates competing for open positions, companies have used bachelor’s degrees to screen applicants, she says. Job openings requiring a four-year degree increased by 10% between 2007 and 2010.
But despite calls for more diversity, four-year degree requirements have proven flexible. For many companies, promises to hire and promote new employees have failed to have much of an impact beyond pilot programs and public statements.
In February, Siegelman found that 45% of companies that removed degree requirements from a sample of 11,300 job ads, including Amazon, Oracle, Lockheed Martin and Kroger, did not change their hires. Co-authored the report.
About 18% of companies, including Nike, Uber and HSBC, initially made progress in hiring more workers without degrees, but then retreated. Siegelman said the group had good intentions, but failed to put systems in place to make decisions less risky for recruiters.
Lockheed Martin says it aims to “build a workplace that fosters innovation and embraces diverse perspectives.” Amazon says it is committed to hiring people based on skills. HSBC declined to comment. Kroger, Nike, Uber and Oracle did not respond to requests for comment.
The Burning Glass Institute’s focus on hiring workers for skills creates new opportunities for only about 97,000 workers a year out of 77 million jobs. It is estimated that “In other words, despite much hype, the increased opportunities promised by skills-based hiring failed to materialize for one in every 700 jobs hired last year,” the report said. .
One obstacle is that skill-based recruitment requires more effort than degree-based recruitment. Michelle Hodges, United’s vice president of global human resources, said the airline began documenting the skills needed for management positions in December. The procedure is expected to be completed next year.
Airlines should train recruiters to identify relevant skills in candidates during interviews. They also need to help existing workers, many of whom have invested in degrees and take out student loans, understand how they are opening up to a wider pool of applicants. .
According to Gaynor, the battle for companies to hire new-collar workers is actually a battle to convince senior executives and human resources teams. This is because it is easier to recruit from universities.
“Universities are very convenient places for HR,” she says. “It reduces risk. You can hire finance, IT, marketing people. They’re all on the same page. . . . It also gives HR people the ability to say, “If it doesn’t work out, it’s my fault.” It is also an independent qualification that conveys, “This is not the case.” They had a pedigree. ”
However, it may be worthwhile to address these challenges. According to research from the Burning Glass Institute, retention rates for workers hired in skill-based processes are 10 percent higher than those with a bachelor’s degree, and workers hired into new roles earn an average salary of 25% higher. Percentage increase.
This trend made sense to Sandra Dubose, a higher education program coordinator turned Cisco marketing specialist. Dubose started his career at a time when soft skills, work experience, and grit were more important than degrees. But as employers’ demands changed, she was excluded from the role, even though she was “able to do all these things while looking at work and with her eyes closed.”
DuBose says it would be painful if people went back to excluding workers without a four-year degree from advancement opportunities.
“This is an awakening that needs to continue,” she says. “I really hope people understand that and understand that the way things were happening wasn’t right and that (employers) were cutting off their noses to disfigure their faces. We are ready to work and deserve the same opportunity to succeed as anyone else.”
