The New-Collar Workforce

There’s a huge, capable, and diverse talent pool out there that companies aren’t paying nearly enough attention to: workers without college degrees. It’s time for a skills-first approach to hiring and people management.

by

and

Ginni Rometty

by

and

Ginni Rometty

From the Magazine (March–April 2023) · Long read

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Summary.

Many workers today are stuck in low-paying jobs, unable to advance simply because they don’t have a bachelor’s degree. At the same time, many companies are desperate for workers and not meeting the diversity goals that could help them perform better while also reducing social and economic inequality. All these problems could be alleviated, the authors say, if employers focused on job candidates’ skills instead of their degree status.

Drawing on their interviews with corporate leaders, along with their own experience in academia and the business world, the authors outline a “skills-first” approach to hiring and managing talent. It involves writing job descriptions that emphasize capabilities, not credentials; creating apprenticeships, internships, and training programs for people without college degrees; collaborating with educational institutions and other outside partners to expand the talent pool; helping hiring managers embrace skills-first thinking; bringing on board a critical mass of nondegreed workers; and building a supportive organizational culture. IBM, Aon, Cleveland Clinic, Delta Air Lines, Bank of America, and Merck are among the companies taking this approach—and demonstrating its benefits for firms, workers, and society as a whole.

Idea in Brief

The Problem

Many jobs are inaccessible to workers who have the skills and aptitude to succeed at them—but not the four-year degree that employers often require. This situation is hurting workers, companies, and society as a whole.

The Faulty Mindset

Some hiring managers think that a bachelor’s degree serves as a good proxy for capabilities such as collaborating well, taking initiative, and thinking critically. There’s virtually no evidence to support that notion.

The Solution

A skills-based (rather than a degree-based) approach to hiring, promotion, and development offers companies a powerful means of meeting their staffing needs, advancing overlooked talent, and increasing racial and socioeconomic diversity.

Earning a bachelor’s degree can expand one’s mind, widen horizons, and provide a pathway to a well-paying, satisfying career. Yet for those who don’t complete four years of college, the lack of a BA or BS looms as a barrier. Millions of people are locked out of promising job opportunities because too many companies default to hiring workers with four-year degrees, even for positions that don’t require that level of education. The trend began decades ago but spiked during the Great Recession: Research by Alicia Sasser Modestino, Daniel Shoag, and Joshua Ballance shows that from 2007 to 2010, job postings requiring at least a bachelor’s degree increased by 10%. That number dropped somewhat as the economy recovered, but scores of jobs remain inaccessible to people who have the skills and aptitude to succeed at them—but not a college diploma.

A version of this article appeared in the March–April 2023 issue of Harvard Business Review.

Colleen Ammerman is the director of the Race, Gender & Equity Initiative at Harvard Business School and the coauthor, with Boris Groysberg, of Glass Half-Broken: Shattering the Barriers That Still Hold Women Back at Work (Harvard Business Review Press, 2021).
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Boris Groysberg is a professor of business administration in the Organizational Behavior unit at Harvard Business School and a faculty affiliate at the school’s Race, Gender & Equity Initiative. He is the coauthor, with Colleen Ammerman, of Glass Half-Broken: Shattering the Barriers That Still Hold Women Back at Work (Harvard Business Review Press, 2021).
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GR

Ginni Rometty was the ninth chairman, president, and CEO of IBM. Today she cochairs OneTen, a coalition committed to advancing the careers of a million Black Americans who do not have four-year degrees. She is the author of Good Power: Leading Positive Change in Our Lives, Work, and World (Harvard Business Review Press, 2023).

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The New-Collar Workforce

Idea in Brief

The Problem

The Faulty Mindset

The Solution

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