How Skills-Based Hiring Results in Workplace Diversity
True or False:
Increasing Diversity, Equity, and Inclusion (DE&I) at your company would be expensive and require a major overhaul.
Surprisingly, that is False. One change at a time can make a marked improvement towards meeting DE&I goals.
At RecruitMilitary, for example, we often use a skills-based approach to help our customers find and hire the right candidates from the U.S. military community.
In this blog, we will discuss:
- What Does Workforce Diversity Mean?
- What are the Business Benefits of DE&I?
- What are the Everyday Benefits of Workforce Diversity?
- Does My Organization Have DE&I Gaps?
- Hiring for Diversity – A Small Change with a Big Impact
- What is Skills-Based Hiring?
- How Does Skills-Based Hiring Benefit My Company’s DE&I?
- Skills-Based Executive Order for Federal Jobs
- Using Skills-Based Hiring to Discover “Hidden Workers”
- The Business Case for Hiring Veterans and the Military Community
- Meet the Right Job Candidates from the Military Community
- Skills to Expect from the Military Community
What Does Workforce Diversity Mean?
Diversity once denoted only race and gender. Now “diversity” has been expanded to various characteristics, including but not limited to:
- Sexual orientation
- Socioeconomic status
- Ability (physical/mental)
Equity considers someone's unique circumstances, adjusting treatment accordingly so that the end result is equal for all parties and provides fair treatment for all people.
Inclusion refers to the degree to which organizations embrace all employees and enable them to make meaningful contributions and how the workforce experiences the workplace. To unlock and retain a diverse workforce, companies must also develop an inclusive culture. Source
Interesting fact: Taking an intentional approach toward workplace diversity isn’t exactly a new concept. In fact, a number of scholars trace the first workplace inclusivity initiative way back to 1948 when President Truman signed Executive Order 9981 to desegregate the armed services.
What are the Business Benefits of DE&I?
Study after study has shown workforce diversity as paramount for productivity, innovation, and problem-solving.
Some recent numbers about the positive outcomes attributed to workforce DE&I practices:
- 19% more innovation revenue reported by businesses with diverse leadership teams. Source
- 50% of gender-diverse organizations outperform their more homogenous counterparts. Source
- 12% higher employee performance in diverse organizations versus companies with no inclusivity efforts. Source
- 19% increased retention due to improved employee engagement (a result of DE&I.) Source
- 57% more collaboration due to improved employee engagement (a result of DE&I.) Source
- 25% more likely to experience above-average profitability for companies with higher gender diversity on executive teams than peer companies. Source
- 36% more profitability for companies in the top quartile of ethnic and cultural diversity versus peer companies. Source
- 5x more predictive of job performance to hire based on skills rather than hiring based on education. Source
- 19x larger talent pool available through skills-based hiring rather than hiring for experience or education. Source
- 88% of hirers are filtering out highly skilled candidates simply for lacking traditional credentials such as past job title or degree. Source
- 44% easier to fill roles when organizations tap into the ranks of hidden workers. Source
What are the Everyday Benefits of Workforce Diversity?
While the numbers above tell the business case for DE&I hiring, there are also everyday benefits that can’t be as easily measured but have significant impact.
DE&I Increases Productivity – An inclusive workplace promotes the open exchange of ideas. It also allows people from various backgrounds to learn from one another, making teams more innovative and productive. Diverse perspectives on ongoing challenges also provide innovative solutions to industry-wide issues.
DE&I Drives Innovation - Diverse teams bring a more comprehensive range of perspectives, insights, and ideas, resulting in stronger decision-making and problem-solving capabilities.
DE&I Helps Reduce Absenteeism & Improve Retention- There is a clear link between diversity & inclusion and employee engagement. According to several studies, companies with a diverse workforce have higher engagement levels.
DE&I Boosts Brand Reputation - Diversity in the workplace is frequently seen as an indicator of good companies. Employers who accept and accommodate all backgrounds and treat their employees equally are more appealing to prospective employees. Since a varied workforce directly reflects the community in which it works and perhaps the community it serves, it helps boost your brand’s reputation.
DE&I Improves Customer Satisfaction - A diverse team has the ability to tap into the needs and challenges of a diverse customer base. It’s not just an abstract concept - diversity works.
Does My Organization Have DE&I Gaps?
One way to tell if your company has a DE&I gap is by observing your organizational structure. When it comes to the people making high-level decisions, are they mostly the same gender/race/ethnicity? If so, your organization probably has some room for improvement.
What to do if your organization is not diverse enough:
- Conduct Training - Diversity training does not have to be costly or time-consuming. Your HR manager or other executives can create a course outlining the company’s diversity goals, efforts, and best practices.
- Acknowledge and Celebrate Cultural Differences - During team outings or workplace activities, encourage employees to discuss their traditions, holidays, and customs. Consider making a shared calendar where your team members may identify culturally relevant holidays.
- Commit to Skills-Based Hiring - avoid unintentional bias in the hiring process by looking for the skills needed in different roles.
Hiring for Diversity – A Small Change with a Big Impact
Would you say that your hiring strategies are pretty sensible?
Hopefully the answer is yes, but when was the last time you broke down the process step by step to think about where it might be cutting off viable or “hidden” candidates?
Many companies only hire people who they perceive as a "good fit” for their company culture, leading to groupthink and other issues. Is unintentional bias weeding out potential hires at your company? Skills-based hiring provides a solution.
What is Skills-Based Hiring?
Rather than requiring education or previous work experience, skills-based hiring eliminates the pre-conceived idea of the “perfect candidate” and focuses on the skills required to perform the role. “All candidates are considered equally as long as they are able to perform the duties.”
For employers, hiring based on skills is five times more predictive of job performance than hiring based on education and more than twice as predictive as hiring based on work experience.
Employees who feel their skills are not being put to good use in their current job are ten times more likely to be looking for a new job, compared to those who do feel their skills are being put to good use.
Using a skills-first hiring approach helps employers to find the best workers but also retain them during times when it is historically difficult to do so.
How Does Skills-Based Hiring Benefit My Company’s DE&I?
A recent report found that “the current labor market is full of missed opportunities where incredible candidates are not getting matched to positions that could positively impact companies, the economy, and society.”
This new data indicates that a skills-based approach to hiring provides opportunities that lead to a more resilient workforce. In this model, workers can find and stay in jobs that match their skills and potential, creating a more engaged workforce.
A skills-based hiring approach also widens the talent pool for businesses and generates increased opportunities for more workers by leveling the playing field. In the US, talent pools can increase by 19x when using a skills-first approach.
However, current methods of finding talent often exclude large swaths of the population; workers who may have the capabilities businesses are looking for but don’t have traditionally accepted experience or credentials. A recent survey confirmed that 88% of hirers agree that they are filtering out highly skilled candidates just because they lack traditional credentials such as past job title or degree.
Skills-Based Executive Order for Federal Jobs
Skills-based hiring is a DE&I practice that has been gaining steam for a while. Back in 2020, the White House signed an executive order that encourages federal government employers to waive “college degree” as a minimum on job requirements. The order states that:
“Employers adopting skills- and competency-based hiring recognize that an overreliance on college degrees excludes capable candidates and undermines labor-market efficiencies. Degree-based hiring is especially likely to exclude qualified candidates for jobs related to emerging technologies and those with weak connections between educational attainment and the skills or competencies required to perform them. Moreover, unnecessary obstacles to opportunity disproportionately burden low-income Americans and decrease economic mobility.”
The order goes on to say that “modernizing our country's processes for identifying and hiring talent will provide America a more inclusive and demand-driven labor force.”
While skills-based hiring is a surefire way to widen the net for diverse candidates, it’s not enough to simply hire the right people. You must remember the equity and inclusion pieces. That means hiring the candidate into an environment where they will feel welcomed, safe, and equal.
Using Skills-Based Hiring to Discover “Hidden Workers”
In a recent study by Accenture, “Even as public sector employers search to recruit new talent, they are facing considerable challenges with retaining talent and ensuring skill alignment of their current workforce.”
At the same time, a promising talent pool remains untapped. Accenture refers to these candidates as “hidden workers” and are often unemployed or underemployed.
This report also explains how this group of people “are eager to find work, or to increase their working hours. Some have withdrawn, discouraged, from the job market, but would work if given the opportunity. Many already have the skills they need to do well in their desired jobs; most are more than willing to learn.”
Hidden workers are defined in this study as a diverse group spanning:
- Veterans & Military Spouses
- Immigrants & Refugees
- People with Physical Disabilities
- People with mental health or developmental / neurodiversity challenges
- People from less-advantaged populations
- People with a criminal record
- People without traditional education qualifications.
The Business Case for Hiring Veterans and the Military Community
A great example of skills-based recruiting is the enlisted U.S. military. After taking aptitude tests, recruits are given a choice of MOS (military occupational specialty) options that fit their abilities and interests.
In most cases, this process does not take education or previous experience into account. Instead, candidates go through a screening and training process to ensure they meet requirements of the role. As a result, America’s rich and diverse population is reflected in today’s military and into the veteran population.
With an array of advantages including tax breaks for hiring veterans and gaining soft skills like leadership, commitment, and teamwork, organizations that hire from the military community experience significant benefits.
Meet the Right Job Candidates from the Military Community
Using skills-based hiring to widen your candidate pool is a wonderful start, but sometimes companies need help with access and exposure to the right audiences.
RecruitMilitary Service Solution guides organizations and hiring managers through the entire process – from optimizing your job descriptions, to translating military skills and connecting you to job seeking veterans and military spouses through our career fairs.
This managed service also offers the assistance of a Client Success Manager, a subject matter expert on military-to-civilian transition, bringing a different value to every customer.
RecruitMilitary Service Solution (RMS²) provides a long-term, strategic approach to consistently connecting with this stream of hidden and untapped talent in a systematic manner.
Skills to Expect from the Military Community
These companies have used RecruitMilitary Service Solution to meet different hiring needs.
Cassie Glubzinski, Military Outreach Coordinator at John Deere: The fact of the matter is that skilled candidates are often missed if they haven't talked to the right people. The whole point of my job at John Deere is being the “right people” for military folks.
Veterans and military spouses are adaptable - they have leadership skills, innovative mindsets, and are mission focused. Those are qualities and characteristics that are not easily taught and have become a business imperative for a lot of companies.
My job, and the job that my team is doing at John Deere, exists because we recognize that, and really capitalize on the veteran and spouse talent that's out there.
Sarah Thacker, Senior Talent Acquisition Leader from Ground Penetrating Radar Systems LLC: We've hired many veterans now and their leadership traits stick out to me. Being a project manager at Ground Penetrating Radar Systems does not mean that you are providing leadership to direct reports, but you are a leader in the field.
And that leadership, that grit, that determination, that drive, and that empowerment is something that translates beautifully into the field for us.
For me, the benefits of RMS² are in the long game. The short game is finding a hire and making the connection. But the robust marketing, lead development, and employment branding as part of RMS² helps our long game.
I'm focused on growth. Not just the hires for the next couple of months, but how do we seed the garden for what we need in the next couple of years, because we want veteran talent to fill our roles. We know that there's success with that.
Elizabeth Toledo, HR Director from Barrett Distribution Centers: We see a lot of candidates that are a good fit for our industry. Especially on the management and the supervisory side, being able to lead a team is important.
Sometimes that's half the battle when you're looking for a candidate - you can always train them on the specific industry but having those solid management skills and the ability to build a team, manage a team, and have that team be successful are some of the best qualities that we found in working with veterans.
If your organization is looking for a diverse and largely untapped talent pool that is rich with technical and soft skills, let RecruitMilitary introduce you to the veteran and military spouse population.
Read more DE&I practices to bring veterans, transitioning service members, and military spouses into your organization:
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