No degree, no problem: Workers without degrees may be the key to tackling company labor shortages

Most employees without a college degree are more than fit for jobs that require them — all that’s missing is an employer willing to fill in the gaps.

The demand for a skilled workforce is increasing faster than the supply of workers with college degrees, according to a paper from the National Bureau of Economic Research. The result is rising wage inequality by education levels and an increase in firms facing a skills gap — which is why on-the-job training and education may be more valuable than having a degree requirement for open positions.

“While a four-year degree used to be a minimum requirement for many roles, companies are shifting away from this and instead focusing on skills and direct work experience,” says Dimitris Tsingos, co-founder and president at global learning tech company, Epignosis. “Employers have seen that people can acquire skills in many different ways through programs like coding camps or internships.”

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Reskilling and upskilling current employees has been a rising trend among employers looking to retain top talent and attract new one. But upskilling and reskilling won’t work for potential prospects that don’t have a formal education or a traditional understanding of a job.

This demographic of workers is referred to as STARs — skilled through alternative routes — and is made up of 70 million workers who have a high school diploma or GED but not a four-year college degree. Over 30 million STARs have the skills for jobs that pay, on average, 70% more than the ones they’re working in today, according to a report conducted by McKinsey. But this talent pool is often overlooked due to their educational background, or perceived lack thereof.

This results in degree-less employees having to work harder than their traditionally educated colleagues — and for significantly less pay, Tsingos says. And too often it gets in the way of their career trajectory.

“In companies and verticals where a degree is valued over skills and experience, workers without traditional education may find it a challenge to climb up the ladder and advance in their careers,” he says. “[Degree-less workers] may need to work harder to prove their value and expertise.”

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The goal is to provide STARs with the mobility to move out of low-to-medium-wage positions and into positions that appropriately compensate their skill sets, which will require a perspective shift from employers, according to Tsingos. And the pandemic may have had a hand in doing just that.

COVID-19 triggered a nationwide labor shortage — in April, the U.S. reported a record 9.3 million job openings but only managed to fill approximately 6.1 million, according to the Bureau of Labor Statistics. The demand for employers to fill positions is at an all-time high, creating the perfect opportunity for employers to invest in learning and development initiatives that could not only attract new talent, but retain them, too.

“Training candidates in technical skills is easier than teaching soft skills,” Tsingos says, referring to candidates' personalities and social attributes. “Many organizations are willing to hedge their bets on someone with strong soft skills and then help them get up to speed to meet other requirements of the role.”

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As for tackling more technical skills an employee may lack, launching on-the-job training programs, such as coding courses or workshops, is a good starting point. Mentorship programs are also a valuable investment for companies dedicated to educating their employees to sharpen their newly-acquired skills. Finally, another consideration for employers is to offer opportunities for employees to finish their degrees while employed — whether that be through tuition reimbursement or a stipend.

“In an ever-changing world, learning should never stop,” Tsingos says. “That goes for all workers — no matter their degree or lack of it.”