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Why Companies are Moving Away from College Degree Hiring Requirements in 2023

2023 will mark a noticeable shift away from a 40-year trend of degree requirements for career positions.

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Over the last four decades, companies have used degrees and education levels to weed out “unqualified” job applicants. But business leaders have started questioning this conventional wisdom for many entry and middle-skill level jobs and even some higher-skill roles. This year will mark a noticeable shift away from a 40-year trend of degree requirements for career positions. Essentially, fewer employers will measure the worth of a potential employee through the degree(s) they hold. Instead, recruiters will focus more on skills in the hiring process.

hiring requirements

Companies are eliminating degree requirements

More companies are eliminating degree requirements in order to attract the workers they need. According to an analysis by the Burning Glass Institute, U.S. job postings requiring at least a bachelor’s degree were 41% in November, 2022 – down from 46% at the start of 2019 before the Covid-19 pandemic.

Even the U.S. government is getting on board. An executive order from the White House in January, 2021 shared limits on educational requirements when hiring for IT positions. It stated that focusing on college degrees “excludes capable candidates and undermines labor market efficiencies.”

Why Companies are Moving Away from College Degree Hiring Requirements in 2023

In order to attract and retain the best employees, businesses and organizations are making big adjustments. More and more companies are assessing job candidates based on their ability to perform the role, rather than by their credentials and prior experience. There are two main things driving this change:

  1. A desire to hire the best talent

In order to widen the talent pool and hire the best talent, companies, especially those in the tech industry, have been recruiting workers from other industries and using upskilling, reskilling, and quicker background checks to avoid weeding out good workers. Now they are also dropping college degree requirements and putting a focus on skills.

2. Creating a more equitable workplace

As companies and organizations drop degree requirements, they can create a more equitable workplace by giving workers with a variety of backgrounds an opportunity to use and expand upon their existing skills.

3. Demonstrated skills and competencies

Companies are turning their focus to demonstrated skills, experience, motivation, and potential because of a realization that a person’s educational credentials are not the only way to choose successful candidates.

Some companies are redefining what they consider to be “graduate talent” from bachelor and master’s degrees to include associate degrees, apprenticeships, and certificate programs. Apprentice programs have been growing as a way to fill vacancies and train potential full-time workers. Employees who are hired out of apprenticeship programs don’t necessarily have university degrees but they have demonstrated skills on-the-job that show they are capable of succeeding.

By accepting talent without rigid post-secondary requirements, businesses gain the advantage of broader and more diverse perspectives in the workplace. The Covid-19 pandemic labor shortage pushed companies to look outside the college degree as the sole way to predict job competency and career readiness. It seems 2023 may be the year where workers tear through the “paper ceiling” that has kept many Americans out of well-paying jobs because they lacked a bachelor’s degree.

Partnering with Makai HR

Want to know more HR insights and trends? We’ve got you covered through HR outsourcing! When you partner with Makai HR you can get on with the business you are trying to grow while we take care of your employee needs from payroll to taxes, health insurance/benefits and worker’s compensation. You also gain peace of mind that you are compliant with all of Hawaii’s employer laws (if you’ve ever looked you know that the list is very long and changes happen). When choosing a PEO to partner with, there are many things to consider including cost, services, and technology solutions. 

With the cost of doing business in Hawaii at record highs, we know how important it is to keep labor costs in line with revenue. Our plans are priced competitively and include value-added services like time-in/time-out systems. Our customized PEO solutions are tailored to the size of your business and specific needs. We offer a 100% paperless solution which means that your employees can manage their needs through a computer, tablet, or phone. We can truly improve your employees’ work benefits while freeing you up to operate your business.

What are you waiting for? Companies that partner with a PEO benefit from 7-9% faster growth, 10-14% lower employee turnover; and they are 50% less likely to go out of business. Contact us today to get started!

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