WORKSPAN DAILY | February 11, 2022

Pandemic Disparities: Exploring the Employment Gap

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For decades, employers have increasingly relied on a four-year college degree as a baseline qualifying credential for a job interview. But the population with degrees have hardly kept up with that requirement. “Dismissed by Degrees,” a 2017 study by researchers at the Harvard Business School, found that 70% of the listings for office-supervisor positions required a bachelor’s degree, even though fewer than 35% of people in those jobs possess one.

This “degree inflation,” as the Harvard researchers called it, has been especially divisive when it comes to potential employees who are people of color: Blacks and Latinos possessed only 11% and 14%, respectively, of bachelor degrees conferred in 2017, at a time when that degree is often the minimum standard for well-paying jobs.

So, degree inflation has elbowed out minority workers at precisely the moment when corporations have boasted about embracing more inclusive hiring practices in response to such social movements as Black Lives Matter and the push for more flexible work-at-home arrangements.

In response, a group of Fortune 500 executives — including former Merck CEO Ken Frazier and former American Express CEO Ken Chenault — helped launch OneTen, a nonprofit intended to place one million Black Americans into “family-sustaining jobs” in the next 10 years. Eradicating degree inflation is one of the tentpoles of that effort.

“If you look at Black talent in the workforce, 76% of those 25 and above do not have a four-year degree,” said OneTen CEO Maurice A. Jones. “We can’t do this work unless we get rid of this barrier. One pathway to work may be a four-year degree. But it can’t be the only pathway. Because if it is, then you’re basically locking out access to earning your way to the middle class for 76% of Black talent.”

Addressing that challenge will require a mix of tactics, Jones and other experts say. It means employers will need to become more attentive to the true skills a job requires, with a realistic look at what credentials are necessary to fill them. Education partners will need to tailor their work to ensure workers gain those skills. And HR departments will need to alter their hiring and promotion practices.

Causes and Impact

A growing service industry has also led to employers putting a stronger emphasis on soft skills such as team building, communication, organization and collaboration. As “Dismissed by Degrees” put it: “The growing prominence of social skills across occupations raised the value of four-year college degrees in the eyes of employers, as a minimum qualification for jobs that paid well and were a basis for upward mobility.”

But that emphasis on the four-year degree has played a role in a softened workforce. According to the Bureau of Labor Statistics, workforce participation has declined since its peak in 1997. And it’s created substantial degree gaps in a host of industries. Multiple supervisory job roles have “degree gaps” (that is, differentials between jobs requiring a degree and people in the job who actually possess one) of more than 40%, the Harvard researchers found.

All of which points to the need to rethink what education looks like for entry-level supervisory positions — and for opportunities for promotion within a company. “It often requires something less than a degree — very specific skills that will allow them to be eligible for a very specific job,” said Kristen Hamilton, senior vice president of strategic partnerships at Guild Education, which provides training and upskilling for corporations, and is a participant in OneTen.

At companies such as Walmart and Chipotle, Hamilton said, Guild Education focuses on providing upskilling opportunities for frontline workers who might not otherwise see a degree program as available or appealing. The training is tailored to the particular needs of a company, Hamilton said.

“We look at the unique needs of each company. Sometimes those needs are around tech — how do we get these high-skilled jobs that are hard to fill? And sometimes it's, how can we get more store managers? Chipotle had a challenge with retention and had difficulty finding store managers. So we create pathways within a company that are really unique and specific to those needs.”

Notably, that approach tends to improve the fortunes of people of color. Guild Education reports that Black participants in its Walmart program, Live Better U, are 88% more likely to receive promotions than non-participants, and 71% more likely among Latino participants.

That’s a boon for corporate workforce and retention, but it’s also designed to help participants satisfy individual goals. “We make sure that every single bit of training and skilling that is done is stacking toward the opportunity for that person to earn a degree over time, so they don’t miss out on that — we know that matters,” Hamilton said. “However, we also know that in the immediate term, the question is, ‘How can I have better opportunities via a job that allows me more income?’”

HR Barriers

That ambition can often hit a brick wall at the point of the job listing if a college degree is required. OneTen’s Jones said a cultural movement within HR departments is necessary to avoid the reflex of making a four-year degree a requirement. He points to the example of Accenture, which in recent years has made a dedicated effort to explore new skill requirements.

“When they started, over 80% of their jobs, on paper, required a four-year degree. But when they did the hard work of working with HR, working with hiring managers, working with people managers, working with certain departments, they moved from 80% to 48%,” he said.

Accenture’s own research lays out some strategies for how that work can be done regardless of the company, and in categories outside of race and ethnicity. A 2021 report titled “Hidden Workers: Untapped Talent,” produced in partnership with Harvard Business school, made a handful of recommendations to HR departments: stronger familiarization with “skills profiles of hidden workers” (that is, qualified but underemployed or marginalized workers), customized training and partnerships with organizations with expertise in particular groups.

The report also recommends that companies look for skill sets among underrepresented groups that are good fits for the organization: veterans in aerospace, for instance, and neurodiverse workers in technology.

Incentives for those doing the hiring are important, Jones added. “We need to be working on training and incentives for hiring managers and people managers, making sure that people really are learning how to focus on skills, irrespective of whatever credential journey [potential hires] may have.”

Also important, said Hamilton, is an action plan for promotion around those workers. “People may not necessarily be a front-end software developer right away, but it could be moving there from an entry-level role, doing IT help desk work,” she said. “But we want to make sure that people don't get stuck there and can pursue even higher-wage and higher-skilled jobs past that. You need that second step.”

Focused on the Future

In its first year, OneTen has attracted 60 member companies across more than 30 industries —including Delta Airlines, Hewlett-Packard and Nike — that have hired about 20,000 Black employees to perform what it calls “family-sustaining jobs.”

In addition, there have been approximately 4,000 promotions within that class. That’s not on pace for a million hires in 10 years, but Jones sees the numbers rising fast as more partners come aboard and the awareness of new hiring approaches increases

That’s easier as employers see the business case for that hiring. That effort “translates to employer success in terms of people staying longer at companies and being promoted at a higher rate at companies,” Hamilton said. “The profile of an employer’s brand is significantly increased if they provide skilling and education to their workers.”

Jones noted also that the approach can apply to a range of industries. The effort is more successful if the jobs are as diverse as the candidates, rather than trying to press candidates into a narrow mix of retail or tech jobs.

“There are 800,000 open manufacturing jobs out there, and one of the things we have to do is to find organizations who can prepare people for those,” Jones said. “We have such great non-IT demands. A real part of this job is going to be aligning supply with demand. It’s a matching job.”

About the Author

 Mark Athitakis is a freelance writer and frequent contributor to Workspan.