Now, jobs are more skills-based

The job market in India is constantly changing, and we are now witnessing a significant shift towards skills-based hiring. The old-fashioned approach to hiring, which relied on academic qualifications and work experience, is giving way to a more dynamic method that prioritises specific skills.

This shift reflects a wider recognition that skills, rather than just degrees, are the key to success in today’s highly competitive job market.

A skills-first hiring approach gives priority to a candidate’s practical abilities over traditional qualifications. It is relevant today because it provides equal opportunities for all, allowing talent to shine beyond academic labels. The advantages of this approach include a more inclusive job market and the ability to tap into hidden talent.

According to a report titled ‘The State of Skills-Based Hiring 2023’, 86 per cent of employees believe that they are more likely to secure their dream job when the hiring process includes skills-based hiring.

Disturbing data

However, the latest data from the Periodic Labour Force Survey (PLFS) is alarming: a whopping 86 per cent of individuals aged between 15 and 59 years have not received any form of vocational training.

It is high time that we focus our efforts on converting this pool of individuals into skilled human capital.

Therefore, high schools and post-secondary education institutions must design their curriculum to focus on skills. The New Education Policy (NEP) 2020 rightly emphasises the need for standardised vocational training courses in high schools.

NEP’s goal

To achieve the NEP’s goal of increasing the gross enrolment ratio in higher education, including vocational education, to 50 per cent by 2035, further action is needed. This requires the addition of 3.5 crore new seats to higher education institutions (HEIs) and focusing on a flexible curriculum with creative combinations of subjects.

We must integrate vocational education with mainstream education and allow for multiple entries and exits with appropriate certification. It is imperative to establish Multidisciplinary Education and Research Universities (MERUs) at par with the Indian Institutes of Technology (IITs) and Indian Institutes of Management (IIMs).

The growing integration of advanced technologies like generative AI, machine learning, cloud computing, and data science continue to propel business and alter business operations; the demand for upskilling in technology remains robust. Companies are increasingly seeking professionals with specific skills to fill key roles in areas such as valuation analysis, financial research, investor relations management, and risk analysis within this domain.

Dismantling barriers

Skills-first hiring is a new approach that is dismantling traditional barriers to offer global work opportunities irrespective of educational background or regional certifications. For instance, IBM India has adopted a ‘skill-first’ approach in 20 per cent jobs where college degrees do not matter. In 2012, IBM implemented this approach in the US by removing the four-year college degree requirement from about 50 per cent of its jobs. Ten years later, 29 per cent of the present IBM US workforce in hardware, software, and consulting does not have a college degree. A study conducted between 2017 and 2022 showed that US employers reduced degree requirements for 46 per cent of middle-skill positions and 31 per cent of high-skill positions.

The rise of skills-based hiring can be attributed to several factors. One of the key drivers is the fast-paced evolution of technology, which has made some skill sets obsolete while creating an insatiable demand for new ones. As industries digitize and automate, employers are looking for candidates who have the technical expertise required to navigate this new world.

In a country as diverse as India, this inclusive hiring model allows for recognition and utilisation of a tapestry of skills that may be overlooked in a more rigid, qualification-centric system.

It has the potential to unlock millions of jobs that do not require a college degree and represents a significant departure from traditional hiring practices. The rapid evolution of technology, which is paving the way for a more comprehensive and dynamic professional future.

The writer is a Co-Founder and MD of Orane International, a Training Partner with the National Skill Development Corporation (NSDC) Views are personal.