What Does Skills Currency Mean for Hiring?

If you read human resources or business publications that talk about workplace trends and issues, then you're probably familiar with the term "skills currency." It's a growing trend, and it also can be an issue for both job seekers and employers.

What does it mean, exactly? It means that verifiable skills have now equaled in importance, and will likely soon replace, the time-honored, traditional benchmark for consideration for many jobs: a four-year degree. Skills will now be the currency for employment, and once people have landed that job, they will also be the currency for advancement. Do you want to climb the ladder? Skill up.

Skills gap leads to skills currency

Skills currency has emerged out of the "skills gap" that has been lamented everywhere from boardrooms to corner offices to the shop floor. Technology is advancing at such a rapid rate — we're now in the midst of the Fourth Industrial Revolution thanks to the smartphone, apps, digital technology, the Internet of Things, and more — that people simply don't have the skills to keep up. Companies that recognized the need for people with skills their own employees didn't possess started hiring for those skills (skills-based hiring) and offering their employees the opportunity to skill up via taking courses to earn verifiable credentials in those skills.

At the same time that skills were growing in importance, the four-year degree was diminishing. More and more, people are coming to the realization that a four-year degree is indicative of many things — the ability to learn new concepts, a broad foundation of knowledge in many areas and specific knowledge in a few, a well-rounded education to build on — but it doesn't tell employers in many industries anything about whether or not their candidate actually has the skills to do a job they're hired for. With COVID disrupting on-campus learning, causing students to pivot to more economical options like a 2-year degree and specific skills training, it's the perfect storm. Skills currency is here to stay.

Verification is the key

For employers who want to institute skills-based hiring and promotion practices, the need for verification of those skills is paramount. It's all well and good to see the proficiency in skills listed on a resume, but how do you know the candidate really has those skills? They could simply be tailoring their resume to your job qualifications in your employment listing. Skills-based hiring is dependent on the verification of those skills. That's why looking for candidates who have earned digital credentials is so important.

Similarly, if your company is shifting to a skills mindset, you need to know your existing workforce actually possess those skills. With that shift, it's crucial to offer current employees the opportunity to increase and enhance their skills via digital credentials before looking to hire from the outside. It's a morale issue. It sends the wrong message to hire from the outside because you're looking for people with the skills needed for the future.

Now that skills are the new currency for employment and advancement, skills development needs to be a vital component in every manager's toolkit. At Credly, we're poised to help you help your employees to get the skills they need now and in the future. Fill out the form below if you'd like to learn more about how digital credentials can benefit your organization.

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By Patricia Diaz