Should Companies Prioritize Skills Over Credentials?
Yes, companies should prioritize skills over credentials. Degree requirements have become one of the most pervasive ways hiring teams filter out qualified candidates before they get a fair look. Skills-based hiring evaluates what candidates can actually do, and the research consistently shows it produces stronger hires, lower turnover, and faster time-to-hire.
Why degree requirements have drifted out of alignment with actual job needs
Credential inflation is the gradual rise in educational requirements for roles that do not genuinely need them. A position that once required a high school diploma begins requiring a degree. A degree requirement gets upgraded to a master’s. The bar keeps moving without the work itself changing.
A 2024 study by the Burning Glass Institute found that 43% of job postings requiring a bachelor’s degree could be effectively performed by workers with alternative credentials or relevant experience. Nearly half of all degree-gated roles are filtering out qualified candidates for reasons that have no real bearing on job performance.
43% of jobs that require a degree could be filled by someone without one. That is not a hiring standard. That is a habit.
Hiring managers have leaned on degree requirements because they are an efficient instrument to narrow down large applicant pools. The efficiency is real. So is the cost. This pattern is especially visible in fields already dealing with persistent talent shortages, where qualification standards have come under growing scrutiny. The candidates getting filtered out are not unqualified. They simply did not follow a particular educational path, and that path was never a reliable predictor of whether they could do the job well. Brookings
What does skills-based hiring actually involve?
Skills-based hiring evaluates candidates on demonstrated ability. That can take several forms: technical assessments, structured behavioral interviews, work samples, or competency-based job descriptions. The goal is to measure whether a candidate can perform the specific tasks the role requires, rather than relying on traditional signals like job titles or prior credentials.
Adoption of this approach has grown significantly. In 2024, 81% of U.S. employers were using skills-based hiring in some form, up from 73% in 2023 and 57% in 2022. Between 2014 and 2023, the number of roles eliminating degree requirements grew by four times.
How do skills-based and degree-based hiring compare on outcomes?
The performance data favors skills-based hiring by a significant margin. McKinsey research found that hiring for skills is five times more predictive of job performance than hiring based on education alone. Ninety-two percent of employers say hires made through skills-based methods outperform those chosen primarily on education or experience, and 88% report a reduction in mis-hires after making the shift.
Retention follows the same pattern. Companies using skills-based hiring report 89% better retention of high-performing employees. People hired for their demonstrated ability to do the work tend to stay longer because the match was made on relevant grounds from the start.
Speed and cost move in the same direction. Traditional hiring processes often run 36 to 42 days from posting to hire. Skills-based approaches can cut that timeline in half. Skills-based hiring also saves U.S. employers between $7,800 and $22,500 per role by reducing mis-hires.
McKinsey research found that hiring for skills is five times more predictive of job performance than hiring based on education. Companies using it also report 89% better retention of high-performing employees.
Do employers value experience over education?
More are moving in that direction. For the third consecutive year, fewer than 40% of employers have screened candidates by GPA, according to NACE’s Job Outlook 2025 Spring Update. Around 20% of job postings in the United States have already dropped degree requirements.
When degree filters come down, the available candidate pool expands considerably. LinkedIn research found that removing degree requirements can expand the qualified candidate pool by up to 19 times for some roles. That matters most in industries dealing with persistent talent shortages, where every unnecessarily filtered candidate represents a real cost.
Removing degree requirements from a job posting can expand the qualified candidate pool by up to 19 times. For companies struggling to find talent, that is not a small adjustment.
What is the real challenge in making this shift?
Removing degree requirements from a job posting does not automatically change who gets hired. Research from Harvard Business School and the Burning Glass Institute found that even after companies announced degree-removal policies, many continued to rely on traditional credentials during the actual selection process. The underlying screening habits did not change because the systems and mindset around them did not change.
Skill validation remains a challenge for 62% of HR professionals, according to a 2024 SHRM study. Credentials are easy to verify. Demonstrated skills require more deliberate infrastructure. This question, whether every role genuinely requires a specific credential, is one more industries are starting to ask openly, and the answers are pushing organizations to rethink long-held assumptions.
The Brookings Institution noted in a 2025 analysis that organizations implementing skills-based hiring struggled more with shifting the default assumption that degrees signal quality than with the technology required to support the change. That mindset problem plays out in real hiring decisions every day.
How should companies approach the transition?
The starting point is an honest review of existing job descriptions. For each role, the question worth asking is whether a degree requirement reflects a genuine job need or whether it defaulted into the posting over time. Once that is clear, building structured assessment into the screening process replaces the sorting function that credentials used to serve.
The harder part is bringing hiring managers into the change. When the people making final decisions still default to credential signals, formal policy has little effect on outcomes. Matching the right candidates to the right roles requires a process genuinely designed to surface the best person for the work.
At Trueline, we help organizations build recruiting processes around the talent they actually need. Contact us today to start the conversation.
Frequently Asked Questions
What is credential inflation?
Credential inflation is the gradual rise in educational requirements for roles that do not genuinely need them. Over time, this filters out qualified candidates while doing little to improve who actually gets hired.
What is the difference between skills-based hiring and degree-based hiring? Degree-based hiring uses academic credentials as the primary filter. Skills-based hiring evaluates whether a candidate can actually perform the work, through assessments, work samples, and competency-based interviews.
Do employers value experience over education?
Increasingly, yes. For three consecutive years, fewer than 40% of employers have screened candidates by GPA, according to the National Association of Colleges and Employers. Around 20% of U.S. job postings have already dropped degree requirements.
What are the measurable results of skills-based hiring?
McKinsey research found skills-based hiring is five times more predictive of job performance than education-based hiring. Companies using it report up to 89% improvement in retention and time-to-hire reductions of up to 50%.
Will removing degree requirements from job postings make a difference on its own?
Not without additional changes. Research from Harvard Business School and the Burning Glass Institute found that without structured assessments and updated evaluation frameworks, hiring behavior tends not to change even when the policy does.
Is skills-based hiring practical for smaller companies?
Yes. It starts with reviewing which roles genuinely need degrees, adding structured assessments to the interview process, and training hiring managers to evaluate demonstrated ability.
