While the trend has been well-known, putting a number on the lost steppingstone jobs has been elusive. A new study, published Friday, estimates that such workers have been displaced from 7.4 million jobs since 2000.
The research points to the persistent challenge for the nearly two-thirds of American workers who do not have a four-year college degree, even as some employers have dropped the requirement in recent years.
“These workers have been displaced from millions of the precise jobs that offer them upward mobility,” said Papia Debroy, head of research for Opportunity@Work, the nonprofit that published the study. “It represents a stunning loss for workers and their families.”
Opportunity@Work is part of an emerging coalition of groups that seeks to change the culture of hiring and promotion in corporate America. They are trying to encourage a shift to hiring and career development based on people’s skills rather than degrees.
Part of that effort is to create a body of research that highlights the problem but also the untapped potential of workers.
The group’s researchers analysed employment trends across a wide variety of occupations. The jobs included business managers, nurses, software developers, sales supervisors, financial analysts, purchasing agents, industrial engineers and administrative assistants.
Had workers without college degrees maintained the share of those jobs they held in 2000, there would have been 7.4 million more of them by the end of 2019, the study concluded.
A previous study by Opportunity@Work, with academic researchers, dissected skills in different occupations and found that up to 30 million workers had the skills to realistically move to new jobs that paid on average 70% more than their current ones.
Some major companies have started to adjust their hiring requirements. Rework America Business Network, an initiative of the Markle Foundation, has pledged to adopt skills-based hiring for many jobs. Companies in the group include Aon, Boeing, McKinsey, Microsoft and Walmart.
OneTen, a nonprofit, has gathered commitments from dozens of companies to pursue the goal of hiring or promoting 1 million Black workers without college degrees to jobs with family-sustaining incomes over the next decade. The companies include Accenture, AT&T, Bank of America, Caterpillar, Delta Air Lines, IBM, JPMorgan Chase, Merck, Target and Wells Fargo.
The drive to increase workforce diversity is one motivation for the change. Screening by college degree hits minorities particularly hard, eliminating 76% of Black adults and 83% of Latino adults.
But companies and labour experts also emphasise the competitive and economic benefits of tapping a wider pool of capable workers.
“The country as a whole will benefit from not stranding human capital,” said Erica Groshen, an economist at Cornell University and a former head of the Bureau of Labor Statistics.
There is recent evidence that the pandemic shortage of workers may be prompting companies to loosen degree requirements. A study published this month by Keith Wardrip, a researcher at the Federal Reserve Bank of Philadelphia, compared online job listings in the five quarters before COVID hit and the five quarters after.
In the pandemic period, there were 2.3 million more postings for what he classified as opportunity employment jobs — those that pay more than the median national wage of $36,660 and are accessible to workers without a four-year college degree.
Much of the increase was due to the higher demand by companies that were short of workers as many people pulled out of the job market for health concerns, family obligations or personal reasons. But Wardrip found that 38% of the increase was attributable to lower education requirements for some jobs.
Major companies that have moved to skills-based hiring in recent years say the shift has given them a stronger, more diverse workforce.
A few years ago, Wells Fargo, as part of a broader review, was rethinking its hiring and career development practices. A question at the time, recalled Carly Sanchez, executive vice president for hiring and diversity recruiting, was, “Are we eliminating some of the best talent?”
The bank decided it was and changed its practices. Today, more than 90% of jobs at Wells Fargo do not require a four-year degree, “almost a total reversal for us” from five years ago, Sanchez said.
Accenture began an apprenticeship program in 2016. What started as a small corporate citizenship initiative, with fewer than 20 apprentices, has become a significant part of the technology consulting and services company’s recruiting and hiring.
This week, Accenture announced a goal of filling 20% of its entry-level positions in the US through its apprenticeship program in its current fiscal year, ending in August. The company expects to have 800 apprentices this year.
The apprentice hires, the company said, have excelled in measures like productivity and retention. They often bring skills and traits nurtured in past jobs or in military service, like teamwork, communication, persistence and curiosity — so-called soft skills that are important to clients in technology projects.
In the shift to skills-based hiring, Opportunity@Work and other groups refer to such workers as STARs, for skilled through alternative routes. The term is meant to emphasise the skills that a large share of American workers have acquired instead of a degree that they lack.
Accenture’s apprenticeship program began by preparing people for back-office technology support roles, but it has become a path to higher-skilled tech jobs working on client projects, said Jimmy Etheredge, CEO of Accenture North America.
“I’ve been surprised by how far the apprenticeship program has gone in the technology roles,” he said. “I had not thought it would get as big as it has.”
After finishing the yearlong apprentice program, Del Walker, 28, of Chicago, became a full-time Accenture employee in 2020. Walker, like 80% of those who have gone through the program, does not have a college degree. But she has held a series of jobs, completed community college coursework in nursing and information technology, and is a graduate of Year Up, a national nonprofit job training program.
Walker is currently a software engineering analyst, working with Accenture’s software development teams and clients — recently, a large fast-food company. She has mastered technical skills like basic programming and software testing techniques and is adding to them both on the job and by taking online courses on her own.
“If there’s a new skill set, I’m learning it,” said Walker, whose goal is to become a software developer at Accenture.
Walker declined to say how much she makes, but her circumstances have certainly changed. “I can buy stuff now,” she said. “If I want to buy an expensive purse, I can.”
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